Ohio retirement spending below average
NASRA report highlights states’ contributions toward public pensions
By Michael Pramik, Ohio Public Employees Retirement System
April 17, 2025 – Ohio’s governmental entities spend much less as a whole on pensions than the national average, says a recent report by the National Association of State Retirement Administrators.
Ohio’s state and local government contributions to public pensions constitute 3.51 percent of the governments’ direct general spending, NASRA said. That’s 15 percent less than the national average of 4.13 percent.
NASRA posted the averages for all states during fiscal years 2023 and 2022 in its issue brief, “State and Local Government Spending on Public Employee Retirement Systems.”
Employers in fiscal year 2023 contributed about $217 billion to pension benefits, NASRA said. That capped a robust two-year contribution hike, from $186 billion in fiscal year 2021. NASRA said the 2023 total reflects increased commitments to contributions over the actuarial requirements in many cases. The boost “is expected to result in a relatively stable percentage of spending on pensions.”
As NASRA reports, pensions in most states do not represent a significant slice of total government spending. While Ohio’s total percentage contribution is below the average, other states pay more toward public pensions. Louisiana (7.79%), Illinois (7.61%) and Nevada (7.35%) were the three highest-contributing states.
Members can find this data and more on the Pension Research Center page of our website. It’s a place to go to find online and print resources on the merits of defined benefit plans and other topics relevant to our stakeholders.
Michael Pramik
Michael Pramik is communication strategist for the Ohio Public Employees Retirement System and editor of the PERSpective blog. As an experienced business journalist, he clarifies complex pension policies and helps members make smart choices to secure their retirement.
How has if any , the recent tariff enactments impacted the Ohio PERS fund? I heard there has been a $4 billion dollar loss to the PERS fund!. Please verify.
Sadicka,
Financial markets often react quickly and emotionally to the announcement of tariffs. However, these early reactions are less likely to impact institutional investors such as OPERS, which invest over a period of decades rather than days. OPERS diversifies the investments in its Defined Benefit and Health Care funds with a goal of earning consistent returns over a long-term horizon to mitigate the impact of sudden changes in the economic landscape.
In November 2024, OPERS enhanced its ability to handle market volatility by approving a 10% allocation to a new Defined Benefit Fund allocation called Risk Mitigation Strategies (RMS). In January 2025, a similar approval and 10% allocation to RMS also was made to the OPERS Health Care Fund. This allocation includes investments that are not closely correlated with equity markets, providing better protection for the portfolios when stock prices decline.
I think OPERS is doing fine. Especially since you worked so long to get the WEP law changed. That has been a huge help along with the assistance paying for health care insurance. Thank you!
Vilas,
Thanks for your comment.
Well of course. Ohio legislators destroyed the actual value of the defined benefit plan after 2012 pension reform. OPERS is one of the worst pension plans in the country. 67 is the full retirement age? No one can ever start their career in public service after the age 30 with such a poor return. You would be better off with a matching 401k. And the state is too cheap to pay into Social Security. Do you expect me to contribute 10% and my agency 14%? But wait until 67 for a full benefit. NY and CA public servants contribute much less and their full retirement is 5 and 7 years earlier. But OPERS wants you to work until 67. Seriously? For a pension? What a joke. May choose the member directed plan soon.
Mike,
We suggest you familiarize yourself with OPERS’ eligibility requirements. Someone starting a public-service career in an OPERS-covered position at age 30 could retire with an unreduced benefit at age 62.