This article comes from The National Institute of Retirement Security.
The challenges facing small towns across America have been well-documented. Many small towns and rural communities face shrinking populations and slowing economic growth. As the economy in the United States (U.S.) has shifted to one focused on services and proximity to financial and intellectual capital, many small towns and rural communities have been left behind. This, in turn, causes young people to leave for urban areas, where wellpaying jobs may be more readily available, which only exacerbates the problem. According to U.S. Census Bureau research, while 13 percent of Americans were 65 and older in 2010, in rural areas they accounted for 17.2 percent of the population, which has been referred to as the ‘Graying of Rural America’. Despite these challenges, there is one positive economic contributor for many rural counties in the United States: the flow of benefit dollars from public pension plans into these areas.
In many small towns, the largest employer may be a public entity, such as a school district. State and local government employees typically earn a defined benefit pension during their career and many of these public servants stay in their community to collect their pension benefit after they retire. This keeps money in the community when retired public employees spend their pensions at local businesses.
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