Public Pension Funding Ratios Increased in 2022, NCPERS Study Finds

NCPERS annual survey tracks pensions’ fiscal, operational and business practices

WASHINGTON--()--Public pension funds’ average funding ratio increased to 77.8% in 2022, with the majority of pensions’ revenue (68%) coming from investment returns, according to an annual study by the National Conference on Public Employee Retirement Systems (NCPERS).

Now in its 12th year, NCPERS 2023 Public Retirement Systems Study: Trends in Fiscal, Operational, and Business Practices provides a benchmark for public retirement systems while tracking funds’ fiscal conditions. A record 195 state and local government pension funds responded to the survey, which was conducted in the fall. These funds represent more than 19.6 million active and retired members with combined assets exceeding $3 trillion.

Public pension funds saw, on average, one-year returns of around 11.4%. Of the various asset classes that pension funds invest in, real estate and private equity saw the largest returns last year.

“The study’s findings highlight public pensions’ resiliency in the face of volatile markets, rising interest rates, and disruption in the workforce during the COVID-19 pandemic,” said NCPERS Executive Director and Counsel Hank Kim. “It’s clear that public pensions remain dedicated to maximizing returns while managing risks in order to efficiently deliver retirement benefits to public servants all over the country,” he added.

Despite the many unprecedented challenges that public pensions have faced in recent years, fund confidence remains high. Surveyed funds were asked, “How satisfied are you with your readiness to address retirement trends and issues over the next two years?” The average rating was 7.8 on a 10-point scale, down only slightly from the year before.

In addition to the report, an interactive dashboard is available exclusively to NCPERS members. Pension funds can use this tool to filter survey data in a number of ways to compare their performance, assumptions, and expenses to peer groups.

Among the key findings from the NCPERS 2023 Public Retirement Systems Study:

  • The average investment assumed rate of return for pension funds was 6.86%.
  • Both administrative and investment expenses were higher than the year before, with the average expense for all respondents increasing to 64 basis points.
  • While investment returns are by far the most significant source of pension fund revenue at 68%, the average member and employer contributions each rose by one percentage point to 9% and 24% respectively.
  • The aggregated average cost-of-living adjustments (COLAs) offered to members was 2.0%, which was slightly above the 1.7% COLA offered the year before.
  • About 54% of the funds that participated in the survey said that environment, social, and governance (ESG) factors are somewhat or very important in their investment decisions.


The National Conference on Public Employee Retirement Systems (NCPERS) is the largest trade association for public sector pension funds, representing approximately 500 funds throughout the United States and Canada. It is a unique non-profit network of public trustees, administrators, public officials, and investment professionals who collectively manage more than $4 trillion in pension assets. Founded in 1941, NCPERS is the principal trade association working to promote and protect pensions by focusing on advocacy, research and education, including online learning, for the benefit of public sector pension stakeholders.


Lizzy Lees

Release Summary

NCPERS annual survey tracks public pensions’ fiscal, operational, and business practices.


Lizzy Lees