Public Worker Retirements Climbing With NJ Pension Talks
By Samantha Marcus/NJ Advance Media for NJ.com/October 04, 2015
TRENTON - Nearly 10 percent more government workers retired in the first seven months of the year than in the same period last year, a rise some labor leaders say is a response to Gov. Chris Christie's overtures toward cutting benefits.
More than 13,000 public employees retired through July, compared with fewer than 12,000 in 2014, and the increase was concentrated among state workers and public safety employees, state data shows.
"Every time this governor opens his mouth and comes out with a new report or threatens a new report... he scares our guys right to the retirement line," said Ed Donnelly, president of the New Jersey State Firefighters' Mutual Benevolent Association.
In February, Christie threw his support behind a sweeping set of recommendations for government workers' health and retirement benefits. The Republican governor, who was gearing up for his then all-but-certain presidential campaign, said the state's exploding worker benefits costs compelled him to take benefits on for a second time.
Six months later, Christie's "roadmap" hasn't taken off. But it wasn't completely without consequence, New Jersey labor leaders say. Christie's efforts to save the state billions by cutting benefits sowed fear among state employees and sent some rushing to retire sooner than they'd otherwise planned, they said.
"I can speak for the cops. The cops are nervous," said Patrick Colligan, president of the New Jersey State Policemen's Benevolent Association. "And the guys who have put in their time are afraid that something else is coming down the road."
The data has closely tracked their speculated link between Christie's heightened rhetoric and the retirement rush.
Workers bracing for the first wave of benefits reforms after Christie took office in 2010 left in droves. While about 12,700 people retired in 2009, more than 20,000 clocked out in 2010. The next year, when the Legislature adopted changes that raised the retirement age, required workers to contribute more for their benefits and froze cost-of-living increases, 19,500 workers left.
"We never had legislation that affected us in our wallets like 2011 did," Colligan said. "Many people went from paying nothing to paying in excess of $1,300, $1,500 a month for health care."
The numbers settled between 15,000 and 16,000 in 2012 and 2013 but began to rise again last year, coinciding with the governor's calls for more reforms in his January 2014 State of the State, where he declared "We need to have the conversation now about further changes to our pension system..."
He followed up that announcement by designating a high-powered commission to offer solutions.
This February, that panel proposed shifting workers to a hybrid defined-benefit, defined-contribution pension system and offering less generous health care plans. That plan, it said, would shave billions off the state's rising annual required contribution.
Unlike the first tranche of reforms, the commission's new recommendations would affect existing employees, striking nerves.
"The fear is that he'll legislate something that will affect people while they're still here," Colligan said. "That's why people have their fingers on the retirement button, people who are eligible but not ready to go."
A spokesman for the Department of Treasury did not respond to a request for comment.
Through the first seven months of this year, the number of workers who have retired or notified the state of their plans to retire is up 9.6 percent from the same period in 2014. If retirements continue at that pace, which is uncertain, nearly 19,500 workers could exit - a level on par with 2011.
To Donnelly, the data merely affirms what he already knew: "If you (compare) the number of retirements to where we were legislatively or politically, those numbers rise and fall based on the stability of pensions and benefits."
"I can't tell you how many calls I get a day - 'What should I do? I hear there's a new report coming out. Should I leave?"' he said.
Tom Bruno, chairman of the Public Employees Retirement System, agreed that pension rhetoric is nudging some workers out the door, but demographics may be playing into the growing numbers of retirees.
According to the the Pew Research Center, 10,000 baby boomers - those born between 1946-1964 - are turning 65 and retiring each day.
The number of school employees who retired through July, 4,299, is actually 77 fewer than the same period last year. Teacher retirements spiked along with everyone else in 2011, but the average age of retirees has increased by almost a year, said Steve Baker, spokesman for the New Jersey Education Association.
The average age was 61 in 2009 and 61.9 in in 2014, Baker said, adding "in actuarial terms, that is pretty significant growth."
"Unequivocally we have members that are very concerned about the pension system," he said. "But I think they understand the system well enough that retiring... doesn't really change the concerns that they have there."
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