A distant view shows a mountainous landscape with sloping peaks, green trees in the foreground, and a cloudy sky above.

Every month retired public employees across the state receive their benefit payments from Colorado PERA. Retirees then spend their income in their communities, supporting local economies and jobs and providing an important stabilizing economic force.



In 2023, PERA paid $4.56 billion in benefits to 114,432 retirees living in Colorado, resulting in $7.1 billion in total economic output and supporting 28,525 jobs in the state, according to <a href="http://copera.org/pacey-report-2024" target="_blank" rel="noreferrer noopener" class="broken_link">a newly released report</a> from Boulder-based Pacey Nehls Economic Consulting. The Economic and Fiscal Impacts report also found PERA retirees paid nearly $382 million in state and local taxes on those benefits, supporting schools, roads, and other vital services.



<h2 class="wp-block-heading">The multiplier effect</h2>



When retirees spend their pension income, it sets off a multiplier effect as businesses then spend money to stock more inventory and hire staff, employees of those businesses spend their own income, and governments collect taxes on all that spending. The result is every dollar in PERA benefits grows as it cascades through the economy.



This cycle of spending illustrates the economic measure of “value-added,” which counts only the additional production of goods and services resulting from PERA distributions rather than total output.



Pacey Nehls estimates a PERA retiree’s economic output multiplier at 1.56, meaning an extra 56 cents are generated in the economy for every dollar a retiree spends. In total, PERA retiree spending resulted in $3.39 billion in added economic value statewide last year.



<h2 class="wp-block-heading">The stabilizing effect</h2>



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="496" src="https://content.copera.org/wp-content/uploads/2024/07/pera-distributions-per-capita-1024x496.png" alt="A chart showing annual PERA retirement distributions per capita for various regions in 2009 and 2023. Colorado statewide: $480 per capita in 2009, $780 per capita in 2023. Metro Denver: $412 per capita in 2009, $708 per capita in 2023. Colorado Springs: $491 per capita in 2009, $735 per capita in 2023. Pueblo-Southern Mountains: $1,007 per capita in 2009, $1,555 per capita in 2023. San Luis Valley: $647 per capita in 2009, $1,155 per capita in 2023. Southwest Mountain: $496 per capita in 2009, $775 per capita in 2023. Western: $507 per capita in 2009, $879 per capita in 2023. Mountain: $363 per capita in 2009, $654 per capita in 2023. Northern: $567 per capita in 2009, $809 per capita in 2023. Eastern: $531 per capita in 2009, $996 per capita in 2023." class="wp-image-52009" srcset="https://content.copera.org/wp-content/uploads/2024/07/pera-distributions-per-capita-1024x496.png 1024w, https://content.copera.org/wp-content/uploads/2024/07/pera-distributions-per-capita-300x145.png 300w, https://content.copera.org/wp-content/uploads/2024/07/pera-distributions-per-capita-768x372.png 768w, https://content.copera.org/wp-content/uploads/2024/07/pera-distributions-per-capita.png 1416w" sizes="auto, (max-width: 1024px) 100vw, 1024px" /><figcaption class="wp-element-caption">Regional per capita annual PERA retirement distributions in 2009 and 2023</figcaption></figure>



The consistent flow of billions of dollars in PERA retirement benefits into communities across the state every year helps add stability to the state and local economies. This stabilizing effect is especially strong in some of Colorado’s rural areas, where public employees make up a larger portion of county payroll and their retirement benefits are higher per capita.



For example, the Denver metro area has the most overall PERA distributions in Colorado at more than $2.3 billion last year, which equates to $708 per person. Meanwhile, the Pueblo-Southern Mountain region’s $382 million in PERA benefits comes out to $1,555 per person.



The stabilizing effect of PERA benefits was especially helpful <a href="https://www.copera.org/pera-on-the-issues/u-s-pension-benefits-played-important-economic-role-in-first-year-of-pandemic" target="_blank" rel="noreferrer noopener">during the COVID-19 pandemic</a>. When businesses, schools, governments, and other entities shut down or greatly reduced staff due to the health emergency, PERA continued to pay benefits to retirees across the state, providing consistent, reliable money to local economies when other economic activity was lower than usual.



For more information, including detailed breakdowns by region and county, <a href="http://copera.org/pacey-report-2024" target="_blank" rel="noreferrer noopener" class="broken_link">download the Economic and Fiscal Impacts report here</a>.

An elderly man, woman, and young boy select apples at a market stand, with the man holding a green basket and the woman and boy smiling.

Measuring the Impact of $4.5B+ in Annual Retirement Benefits in Colorado