USA Today has published an illuminating piece of research about the continual expansion of the number of public worker jobs that qualify for lucrative early retirement schemes. In the main, the paper points out, this involves taking pension benefits designed for public safety workers like police and fire, who in many places can retire at age 50 due to the physical challenges of their jobs, and extending these benefits to other types of workers, including park rangers, dispatchers, and even museum guards.
The paper's research documents that 31 states have passed laws since 2000 alone expanding the number of government workers who can retire by age 50 or 55 because their jobs have now been placed in special early retirement categories. Arizona reclassified probation officers in 2006, while California allowed motor vehicle inspectors and fingerprint analysts into the more lucrative pension category in 2002, and Iowa allowed EMS technicians into an early retirement pension system in 2008, while Maryland placed laundry workers in the state's prison system into the early retirement pension system in that same year. More details about what states did what are here.
From what I have read, states contribute a state employee’s retirement fund much the same as a private sector employer pays into a 401(k) for its employee. Of the about 10% of an employee’s salary paid to retirement by the employee, 6.2% is paid as an amount that would be paid to Social Security in the private sector, with the remaining 3.8% going to the retirement fund, which is invested as with a 401(k). Since state employees do NOT qualify for Social Security benefits, the amount paid by the state, about 14%, goes mostly into a Social Security/disability equivalent with about 1.8% going to the retirement fund. The fund then gets invested and goes to pay the retirement amount equivalent to what a private sector employee would make if the state employee got Social Security. In the case cited in the article, the private sector employee makes $32,000 in pension, and with about $26,000 in Social Security that employee would make about as much as the public employee who gets only a pension with no Social Security. Plus, the private sector employee can possibly get more pay during the work years than a public employee, thereby saving additional retirement funds. Also, once the state employee retires, the state no longer pays into the retirement fund. The retiree benefits are funded by the fund via its management team. The state has no more obligation after retirement, but pays only an equal amount, or less, than a private sector employer during the employee working years. Si it seems there is no burden on the state other than that of any employer in the private sector. I thought this was interesting. From the Winegarner Report April 2011.