Report: Public sector employees facing financial hardship due to inflation, housing costs

Coming off two years of the pandemic, economic uncertainty and financial hardship is being driven by inflation concerns, prompting consumers to change spending habits and some public sector employees to rethink their retirement plans. 

A new survey of more than 1,000 public sector employees from MissionSquare Research Institute found that 84 percent of public sector employees have anxiety about the impact of economic conditions and market volatility on their personal financial security, a statement notes. Further, 48 percent said high inflation and rising housing costs (37 percent) “are triggering lower retirement savings,” a statement from the research organization says. The survey was conducted last month by Greenwald Research. 

In regards to financial hardship in retirement, 81 percent expressed concern about whether or not they’ll have enough to live comfortably in retirement, or be able to stretch it out for long enough. Because of those concerns, 72 percent said they weren’t sure if they could retire on time and 70 percent expressed concern over having enough emergency savings.

“We all should be worried when public service employees are anxious about their financial security,” said Lynne Ford, CEO and president of MissionSquare Retirement about the findings. “It’s so important to ensure the public service workforce has resources, compensation, and benefits to manage their financial security. Saving for retirement is one of the biggest financial challenges facing employees.”

Those who expressed anxiety around financial security were much more likely to be female and come from a household with an annual income of less than $100,000. And amid these financial difficulties, 58 percent said retirement benefits and 62 percent said other other benefits like healthcare, insurance and time off were keeping them in their job.

“The top three actions workers say their employers could take to bolster retirement readiness are higher wages/salary (86 percent), better retirement benefits (54 percent), and better healthcare benefits in retirement (48 percent),” the statement says. 

“These findings highlight that public servants administering key services and programs across the country are not insulated from the broader economic environment impacting all Americans,” said Joshua Franzel, MissionSquare Research Institute’s managing director. “In many cases, public employers are reassessing and expanding their benefit offerings to enable their employees to be financially secure both in the short- and long-term. These efforts also can help address recruitment and retention challenges.”

MissionSquare Research Institute will host a webinar Monday, Oct. 31 at 2 p.m. EST to review the findings. For more information, visit MissionSquare Research Institute’s website.