This study analyzes the status of US public pension systems, covering over 90% of public pension assets across states, cities, and counties. At the close of FY 2023, total reported net pension liabilities were approximately $1.65 trillion, with unfunded liabilities continuing to exceed the size of the US municipal bond market. To stabilize pension systems, state and local governments would need to contribute an additional $96 billion annually.
Key Takeaways
- State and local governments report net pension liabilities of approximately $1.65 trillion. The liabilities exceed the size of liabilities in the US municipal bond market.
- Total employer contributions have reached a historical high of $199.2 billion, equivalent to 21.1% of employee payroll. Despite this increase, the amount still falls $96 billion short what is necessary to stabilize the pension funding status.
- While the nationwide situation has marginally improved over the last ten years, the aggregate metrics obscure the degree of financial pressure that some states and cities face.
The Hoover Institution
By: Oliver Giesecke
September 29, 2025