Updated: October 1, 2018
Issue: The salaries paid to Illinois public school teachers and the pension benefits received monthly by retired teachers and their families who live in Illinois have a positive economic impact on the state that is estimated to be $16.1 billion per year.
In addition, active and retired TRS members’ earnings and benefits support more than 110,600 jobs in Illinois with a payroll of $4.7 billion.
Discussion: The cascading impact of wages and pension benefits on Illinois or its individual counties can be calculated using formulas and standards established by the Bureau of Economic Analysis in the U.S. Department of Commerce; the Bureau of Labor Statistics in the U.S. Department of Labor; and the Office of Trade & Investment in the Illinois Department of Commerce and Economic Opportunity.
At the time of the study, TRS had a total of 412,451 members. Of that, 160,500 were “active;” 108,000 were “retired” and 12,000 were “benefit recipients,” such as spouses of deceased members and dependent children. Of the retirees and benefit recipients, 79 percent lived in Illinois.
Using statistics compiled during the spring of 2018, the wages paid to active TRS members (public school teachers working in districts outside the city of Chicago) and pensions paid to TRS retirees who lived in Illinois translated into a total economic impact of $16.1 billion.
- The after-tax earnings of active TRS members was $6.5 billion, which generated a total economic impact of $9.5 billion.
- The after-tax payments to TRS benefit recipients who live in Illinois was $4.5 billion, which generated a total economic impact of $6.6 billion.
Nationally, a new study released in May by the National Conference on Public Employee Retirement Systems reported that in 2016, retired public employees in the United State received $303.1 billion, which in turn generated a $757.8 billion boost to the economy, including $151.9 billion in state and local tax revenues.