Fewer New Jersey state workers than expected have accepted early retirement offers, according to preliminary data released yesterday.
About 1,500 state employees have accepted the retirement incentives offered under a bill enacted last month, according to state Treasurer David Rousseau. Gov. Corzine's administration had hoped that roughly 2,100 people would take the offers to help slim down state government.
Despite the shortfall, Rousseau wrote in a letter to legislative leaders he still expects to "come close" to the original goal of saving $90 million through cutting payroll. In addition to early retirement offers, he has said the state plans to aggressively use attrition and efficiencies to reduce staff.
"This participation is less than the original projections . . . however, it still reflects that three out of four employees projected to accept the initiative, did so," Rousseau wrote.
Workers had until July 15 to accept the offers and must retire by Friday. State officials are required to report on the final results by Aug. 15.
One union leader said a combination of the souring economy, fear over the state's pension shortfall and rising daily costs, such as gas prices, combined to dampen the enthusiasm for early retirement.
Rae Roeder, president of Communication Workers of America Local 1033, said employees considering retirement depend not only on their pension, but also on personal savings and Social Security.
"The issue of retirement is not this rosy picture," Roeder said.
The state's pension system has a roughly $25 billion shortfall and the state contributes half of what is actuarially required each year.
In addition, Roeder said many workers' pension calculations come out smaller than they anticipate. She said an employee who has worked 30 years in government and earns $50,000 will only receive a $27,000 per year retirement payment, before taxes.
"That eliminates a lot of clerical workers," who won't have enough to retire on, Roeder said.
The retirement incentives were expected to help reduce a state payroll that includes 68,300 in the executive branch and 9,500 in the judiciary.
Large swaths of workers in various departments were ineligible for the incentives, particularly those in "direct care" positions such as employees in veterans' homes, psychiatric hospitals, developmental centers and prisons.
The retirement program was offered to employees who were at least 58 years old with at least 25 years of service, or at least 60 with at least 10 years of service. The incentives included additional retirement payments and enhanced medical benefits.