State retirees aren't leaving a 'brain drain,' officials insist

By DANNY LAYNE
Capital News Service
LANSING — They aren’t leaving in droves, and there’s no “brain drain” occurring in agencies where 7,800 state employees have taken advantage of Michigan’s early retirement program, officials insist.
But the number of people retiring is higher than originally expected.
That means that while many departments will feel the loss of some their most experienced workers, other employees will have an opportunity to move up or move in because others have moved on.
“The idea that the state of Michigan will be experiencing some sort of ‘brain drain’ is ludicrous,” said Kelly Chesney, the director of communications at the Department of Management and Budget. “We have some of the most experienced, dedicated individuals still working and they now have the chance to advance. Not everyone who was eligible for the Early Out Program retired.”
“Job shadowing” or mentoring, staggered departures and increased training are all options state agencies can use to prepare their next generation of senior-level workers, she added. With nearly 8,000 leaving through the early retirement program, about 2,000 newcomers are expected to be hired by the state to fill the vacancies.
State employees with a combined age and service years of 80, or who are at least 60 with a decade of credited service, were eligible for retirement under the 2002 Early Out provisions.
The Early Out program, which was Michigan’s second in the last five years, was announced by Gov. John Engler in March.
The anticipated savings for the state is about $50 million, despite a boost of about 16.7 percent in benefits due to an increase in the multiplying factor used to formulate retiring workers’ pensions, Chesney said.
Workers wanting to participate in the early retirement program had to apply in April and retire between July and Nov. 1 this year. Some workers who are involved in long-term projects or work in critical positions that require their direct involvement in training their own replacements were granted exemptions to the retirement deadline. Michigan is facing an estimated $1 billion deficit and the early-out option was one way to cut into that shortfall.
“The incentive offered by the increased multiplier was the first thing that caught my eye,” said 48-year-old Dave Kaiter of DeWitt. He originally anticipated retiring in seven years, when he was 55, but the rise in the multiplier proved too much of an incentive to pass up. “When it went from 1.5 (percent) to 1.75, I took another look at the retirement option.”
Kaiter, one of about 2,600 employees who qualified for retirement by purchasing service credits, began working for the state’s Family Independence Agency at the age of 17. He spent most of the next three decades within the Department of Transportation. The Michigan State University graduate is now contemplating his post-retirement days.
“Things have definitely changed since I retired early,” Kaiter added. “Without all the stress, I’m a totally different person. I realize I can slow down now and not have to take on so many things.”
Kaiter is also young enough, and experienced enough, to work elsewhere, he said.
“I’m getting to do something my father did not get to do,” he explained, “and that’s to enjoy retirement.”
© 2002, Capital News Service, Michigan State University School of Journalism