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CalSTRS study: benefit payments support about 103,000 California jobs and generate billions in income and taxes
Summary
CalSTRS presented a new economic impact study showing roughly $16.8 billion of benefit payments stay in California, supporting about 103,400 jobs, generating about $7.2 billion in income and roughly $6 billion in tax revenue; staff will post district‑level data and a QR code for legislators and the public.
CalSTRS presented an economic impact study that models how retirement benefit payments ripple through California’s economy and supplied district‑level snapshots for legislators and the public.
Tom Buffalo, head of research, said the study used October 2022–23 1099 tax reporting data, U.S. Bureau of Labor Statistics consumer expenditure patterns for residents 65 and older in the West, and IMPLAN economic modeling to estimate spending impacts. Buffalo said the system paid about $19.9 billion in benefits systemwide in fiscal 2022–23; when filtered to California recipients, about $16.8 billion of those benefits were spent in state, roughly 84 percent of the total.
The report’s headline findings include an estimated 103,400 jobs supported in California by CalSTRS benefit spending, about $7.2 billion in income attributable to that spending for businesses and employees, and roughly $6 billion in tax revenue (including both immediate withholding and subsequent sales, corporate and income taxes). Using IMPLAN, Buffalo said benefit spending contributes an estimated $14,000,000,000 in value added to California’s GDP — a figure Buffalo compared with the output of some industries to provide scale.
Buffalo said the analysis shows CalSTRS benefits have a relatively larger impact in many smaller regional and rural counties (all 58 California counties receive some benefit payments) rather than being concentrated solely in the state’s largest economic hubs.
Board members asked how the findings could be used at the local level. Buffalo said staff will publish the full study and legislative data sheets on calstrs.com and provide a QR code and district snapshots so legislators and local stakeholders can view impacts specific to their districts.
The report’s methodology, Buffalo said, pairs benefit receipt data with consumer spending patterns for older Western households and translates that spending into direct, indirect and induced economic impacts via IMPLAN. He told the board staff will work with communications to distribute the findings widely.
Next steps: CalSTRS will post the study and district snapshots online and provide materials for local outreach. The board did not take formal action on the study itself during the meeting.
