How South Carolina’s Pension Shortfall Compares to Other States
In much of the country, public pension funding has been one of the most persistent public policy problems. For years, many state governments have failed to make necessary investments in their retirement system, resulting in funding gaps that increasingly present a looming reckoning for taxpayers.
Accordinââg to a recent report published by The Pew Charitable Trusts, a public policy think tank, many states are now taking earnest measures to reduce their pension funding gap. These measures include increased contributions, cost reduction strategies, and more sophisticated pension management tools. States have also benefited from once-in-a-generation investment returns following the COVID-19 market crash in March 2020.
Still, based on 2019 data, the most recent year of available comprehensive data, the majority of states have a funding shortfall of 25% or more.
South Carolina’s pension crisis is among the worst of any state, as the state faces a $26 billion funding gap. With $32.3 billion in assets against $58.3 billion in liabilities, South Carolina has funding for only 55.4% of its pension liabilities.
Though the state reported a 28.6% return on assets in fiscal 2021, a dramatic improvement from the 1.6% loss the previous year, structural problems remain. Some in the state are calling for raising the retirement age and shifting new public sector employees to a 401(k) style plan in order to remove the burden on taxpayers that the current funding gap presents.
All pension funding data used in this story was compiled by The Pew Charitable Trusts and is for 2019. We also considered public-sector, state-level employment, both in raw numbers and as a share of overall employment, using data from the Bureau of Labor Statistics.
RankStatePension funding ratioPension assets ($, billions)Pension liabilities ($, billions)State government employees1Wisconsin103.0%112.1108.989,8002South Dakota100.1%12.512.517,3003Tennessee98.2%41.141.895,5004Washington96.3%100.9104.8142,7005New York96.1%215.2223.9254,6006Idaho94.6%17.718.830,1007Nebraska93.1%15.216.342,5008Utah91.7%35.238.481,2009North Carolina88.4%101.4114.6196,10010Iowa85.4%34.840.767,10011Maine84.3%15.117.924,60012Delaware83.4%10.212.232,20013West Virginia83.4%15.919.146,90014Minnesota82.2%70.886.198,90015Oklahoma80.7%33.241.179,70016Oregon80.2%70.287.541,30017Arkansas80.0%28.635.776,20018Ohio80.0%168.4210.5168,00019Georgia78.7%95.6121.6162,50020Florida78.2%163.9209.5246,40021Missouri77.8%59.977.0100,20022Virginia77.2%79.8103.3157,30023Nevada76.5%44.357.940,20024Wyoming76.5%9.011.813,60025Montana72.5%11.916.427,40026California71.9%474.3659.4521,60027Maryland71.6%54.375.8108,10028Kansas69.9%20.629.550,70029North Dakota69.8%5.98.421,40030Alabama69.4%38.555.5117,00031Texas69.0%186.8270.7426,40032Indiana68.6%30.844.9108,90033Alaska67.4%15.222.622,50034New Mexico67.3%29.243.453,70035Louisiana66.9%36.854.986,80036Colorado66.5%51.877.9126,60037New Hampshire65.5%9.214.122,40038Arizona65.2%49.976.689,80039Vermont63.7%4.57.117,80040Mississippi61.7%28.646.457,40041Michigan61.1%65.0106.4178,80042Massachusetts59.4%58.398.1122,60043Pennsylvania58.0%89.8154.8148,60044South Carolina55.4%32.358.3103,50045Hawaii54.9%17.231.467,00046Rhode Island54.5%6.612.120,40047Kentucky44.6%24.053.790,80048Connecticut44.4%32.072.171,00049New Jersey39.7%82.3207.1138,70050Illinois38.9%92.6237.9147,000
Disclaimer: This content is distributed by The Center Square
