Federal Retirement Claims Increase 24 Percent in Fiscal 2018

According to recently released data from the Office of Personnel Management, the number of federal employees who filed for retirement increased 24 percent in fiscal 2018 over the previous year. 

Retirement processing statistics published by OPM earlier this month showed that 7,142 employees filed for retirement in September, the final month of the government’s fiscal year. That brought the total federal retirement claims in fiscal 2018 to 105,298, marking a 24.1 percent increase over the number of claims from the federal workforce in fiscal 2017, which totaled 84,807.

For years, observers warned of an impending wave of federal employee retirements, citing the fact that federal employees skew older than their counterparts in the private sector. In July, 14 percent of the federal workforce was eligible to retire, and in five years, that figure is expected to jump to 30 percent.

Since the election of President Trump, there has also been speculation that feds could leave agencies following disputes over how leaders would consider departmental missions. Until now, data had not supported that hypothesis: in fiscal 2017, 10 percent fewer employees filed for retirement than in fiscal 2016, when 94,985 people made retirement claims.

Donald Kettl, a professor and the academic director at the University of Texas’ Lyndon B. Johnson School of Public Affairs, said a combination of factors likely led to the spike in retirements this past fiscal year.

“Two theories are worth noting: one is that the long-predicted ‘silver tsunami’ is happening,” Kettl said. “The federal workforce is substantially older than in the private sector, so the inevitable might finally be occurring. That is even more likely with the stock market in record territory, as workers decide to cash in. The other is a Trump effect—the possibility that government officials are deciding to leave, given the high levels of tension in some agencies and proposals to downsize and reorganize others.”

Another potential factor likely has been the Trump administration’s efforts, thus far unsuccessful, to stem the federal government’s personnel costs. In each of the last two White House budget proposals, officials have proposed cutting retirement benefits for both current and future retirees in a number of ways, and Trump has backed a pay freeze for federal civilian employees for next year. Congress has declined to act on the cuts to benefits, and lawmakers are expected to overrule Trump’s pay freeze and enact a 1.9 percent raise for civilian federal workers in 2019 after the midterm elections.

Although acting OPM Director Margaret Weichert last week suggested federal employees are not in government for the pay, recent data suggests that compensation does play a role in people choosing to retire. During the Obama administration, there was a freeze on federal employee pay from 2011 through 2013, and locality pay was frozen from 2010 through 2015. As recently as fiscal 2016, federal employee retirements totaled 94,985, according to OPM, 12 percent higher than in fiscal 2017.

OPM officials did not immediately respond to a request for comment Monday.