Is pension killing higher education from within?
- The Plan Sponsor Council of America has released its annual survey of 403(b) organizational holders, sponsored by Principal Financial Group, revealing that higher education is the largest faction (14%) represented among small and large non-profit industrial members.
- Results show that higher education reports more than 70% of eligible employees maintaining a retirement account with their respective schools, and carry an average balance of $109,000.
- More than 59% of institutions make matching contributions to employee retirement.
When legislators cut into higher education budgets, the primary logic behind the cuts lead back to pension and healthcare costs. With higher education among the largest culprits in the number of employees gaining organizational contributions, and a high number of employees working well past retirement eligibility, the financial pressure on the industry's survival is beyond sustainable.
With more reports detailing how construction, inflation and recession recovery have decimated the financial model of higher education, this look at how the industry itself is being taxed by workforce support only heightens anxiety about what is to come.
- Plan Sponsor Council of America PSCA's 2016 403(b) plan report