Defined Benefit Pension Plans: Supporting Ontario’s Economy
Oct. 24, 2024
HOOPP, OPTrust, University Pension Plan (UPP) and The Conference Board of Canada
Defined benefit pensioners contribute billions to Ontario economy
Retirees with defined benefit (DB) pensions are helping to stimulate business growth and job creation in their communities by injecting billions of dollars into the economy every year, a new study by The Conference Board of Canada has found.
In 2023, DB pension plans supported more than one million beneficiaries in Ontario and their pension benefits contributed $34.6 billion to Ontario’s gross domestic product – more than three per cent of the province’s total GDP.
2023 DB pension plans research report
The research suggests that retirement dollars paid from DB pensions allow plan members to feel confident about having a steady income in retirement and in turn, supports local businesses in their communities.
The analysis also found that:
of the DB pension payments spent by beneficiaries are spent within Canada.
in economic output is generated for each dollar of DB pension benefits paid.
full time, full year jobs in Ontario are supported by DB pension beneficiaries.
Why this matters
In 2023, over $42 billion in pension benefits were paid to an estimated 1.23 million people in Ontario. This generated more than $60 billion in economic output, including spending, taxes, and the buying and selling of goods within Ontario.
In today’s environment, where many Canadians feel unprepared for retirement and struggle to save due to the rising cost of living, DB pensions not only offer financial stability and peace of mind by alleviating some of the stress around retirement planning, but also drive significant economic growth.
View the report