CalPERS-CalSTRS Retirees Boost San Francisco Bay Area Region Economy by $4 Billion
SACRAMENTO, CA – Retirees of the California Public Employees’ Retirement System (CalPERS) and California State Teachers’ Retirement System (CalSTRS) pump nearly $4 billion per year into the San Francisco Bay Area regional economy, according to a recent economic study.
The study by the Applied Research Center of Sacramento State University found the Bay Area has more than 130,000 retirees who receive $2.8 billion per year in CalPERS and CalSTRS pension benefits. The region spans Alameda, Contra Costa, Marin, Napa, San Benito, Santa Clara, Santa Cruz, San Francisco, San Mateo, and Sonoma counties.
When those retirees spend their retirement income, they produce an additional $1.2 billion of economic activity, commonly called a “ripple effect,” for a total impact of almost $4 billion on the regional economy.
“This is powerful evidence of the positive economic impact of CalPERS and CalSTRS pension benefits,” said CalPERS Chief Executive Officer Fred Buenrostro. “The study demonstrates that CalPERS and CalSTRS retirees provide a tremendous economic boost to the Bay Area.”
“We should not take for granted the beneficial economic impact of CalSTRS and CalPERS retirees,” CalSTRS Chief Executive Officer Jack Ehnes said. “When retirees spend their retirement income, it fuels the economy and produces economic benefits for all Californians.”
The $4 billion impact of CalPERS and CalSTRS pension payments produces $1.9 billion of value added to the Bay Area regional economy, creating 23,702 jobs with a payroll of almost $923 million per year.
CalPERS and CalSTRS retirement benefits and related economic activity also generate nearly $258 million in state and local tax revenues for the region.
The economic impact data come from a larger study that found retirement benefits paid by CalPERS and CalSTRS generate $21 billion of economic activity per year in the state.
CalSTRS is the second largest public pension fund in the U.S., with assets of approximately $171 billion. It provides retirement benefits to nearly 800,000 active and retired California public educators and their families.
CalPERS, with more than $245 billion in assets, is the largest public pension fund in the U.S. It administers retirement plans covering approximately 1.5 million active and retired California public employees and their families on behalf of more than 2,500 State, school, and local government employers statewide.