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Comparing the Effects of Current Pay and Defined Benefit Pensions on Employee Retention: Working Paper 2018-06

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  • Justin Falk
  • Nadia Karamcheva

Abstract

Federal, state, and local governments continue to consider reducing the cost of their defined benefit pensions by decreasing annuity payments or having employees contribute a larger portion of their salaries toward them, thus reducing those workers’ current pay. Such reductions to compensation can decrease the human capital of a workforce through lower employee retention. Using data that span more than 30 years and reflect substantial policy changes to federal workers’ salary schedules and pension structure, we estimate that the average elasticity of job tenure with respect

Suggested Citation

  • Justin Falk & Nadia Karamcheva, 2018. "Comparing the Effects of Current Pay and Defined Benefit Pensions on Employee Retention: Working Paper 2018-06," Working Papers 54056, Congressional Budget Office.
    • Handle: RePEc:cbo:wpaper:54056
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    File URL: https://www.cbo.gov/system/files/2018-06/54056-employeeretention.pdf
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    References listed on IDEAS

    as
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    Cited by:

    1. Justin Falk & Nadia Karamcheva, 2019. "The Effect of the Employer Match and Defaults on Federal Workers’ Savings Behavior in the Thrift Savings Plan: Working Paper 2019-06," Working Papers 55447, Congressional Budget Office.
    2. Sania Zafar & Danish Ahmed Siddiqui, 2019. "Factors Affecting Employees Performance and Retention: A Comparative Analysis of Banking and Educational Sector of Karachi," Business Management and Strategy, Macrothink Institute, vol. 10(1), pages 93-124, December.

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    More about this item

    JEL classification:

    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • J33 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Compensation Packages; Payment Methods
    • J45 - Labor and Demographic Economics - - Particular Labor Markets - - - Public Sector Labor Markets

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