As can be seen below, higher ed HR execs thus
worry that older faculty are not retiring, making it difficult to recruit new
faculty. UC, with its defined benefit
system, does have a built-in retirement incentive. And stock market gyrations – although they
affect the funding of the plan – do not affect the basic retirement incentives
as seen by participants.
The survey also shows that worries about retiree health care can adversely affect retirement incentives.
In most cases (including UC), retiree health benefits are not guaranteed
in the same way that (defined benefit) pensions are guaranteed. That’s something to think about as such
benefits are manipulated for immediate budgetary reasons or even long-term cost reasons. The basic lesson is that
benefit plans are more than costs; they affect behavior. A focus only on costs can obscure potential
perverse employee incentives that changing benefits can bring about - such as excessively delaying
retirement. It's the kind of lesson everyone knows but, paradoxically, is often ignored or forgotten in practice.
A chart from the survey can be seen below. Click on it for a clearer image.
A chart from the survey can be seen below. Click on it for a clearer image.
The article with a link to the detailed survey is at:
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