The brief’s key findings are:
- The “backloaded” benefit structure of public sector defined benefit plans favors long-tenure workers over short-tenure workers.
- However, when a defined benefit plan is combined with either Social Security or a defined contribution plan, the degree of backloading is reduced.
- Not surprisingly, then, the analysis shows that public workers with either Social Security or a defined contribution plan are less likely to stay until retirement age.
- Giving workers more flexibility to switch jobs leads to better employment matches.