The Civil Service Retirement System (CSRS), established in 1920, is a federal pension plan that covers a diminishing number of federal workers. The remaining population of active CSRS employees is steadily shrinking as these long-tenured workers reach retirement age. Understanding the mechanics of this legacy system provides context for the demographic data that illustrates its decline.
Understanding the Civil Service Retirement System
The Civil Service Retirement System provides a defined benefit plan for federal civilian employees. It is contributory, requiring standard CSRS employees to typically contribute 7% of their salary through mandatory payroll deductions.
A defining feature of the CSRS is its independence from the Social Security system. Employees covered under standard CSRS generally do not pay Social Security retirement, survivor, or disability taxes, though they must pay the Medicare tax. The retirement benefit is derived solely from the CSRS annuity, calculated using a formula based on the employee’s high-three average salary and years of service.
The benefit accrual rate rewards long-term service. For example, an employee with 30 years of service can earn an annuity equal to 56.25% of their high-three average salary.
The Great Transition to the Federal Employees Retirement System
The population of the Civil Service Retirement System began its irreversible decline with the establishment of the Federal Employees Retirement System (FERS), created by the Federal Employees’ Retirement System Act of 1986. This legislation fundamentally changed federal retirement.
The new system became effective on January 1, 1987, at which point CSRS enrollment was closed to new hires. FERS was designed as a three-tiered system that combined a smaller defined benefit plan with mandatory Social Security coverage and the Thrift Savings Plan (TSP), a defined contribution element. The implementation of FERS ensured that the CSRS population would only decrease over time as existing members retired or left federal service.
The Current Count of CSRS Employees
The most recent data from the Office of Personnel Management (OPM) indicates a low number of remaining active CSRS employees. As of the end of Fiscal Year 2022, approximately 44,000 active federal employees, including those in the U.S. Postal Service, were covered under CSRS.
The remaining CSRS workforce represents only about 1.6% of the total civilian federal workforce, with over 98% of current federal employees covered by FERS. This figure represents active employees and does not include the millions of federal annuitants currently receiving CSRS retirement benefits. Since this number is based on FY2022 data, the actual count has continued to decrease due to ongoing retirements, confirming the trend of rapid decline.
Characteristics of the Remaining CSRS Workforce
The remaining CSRS population is characterized by advanced age and long tenure. FY2022 data shows that 91% of active CSRS employees were age 60 or older, and all were aged 55 or older.
Due to their long careers, CSRS employees retiring in FY2022 had an average length of service of 39.2 years. This extended tenure suggests the remaining workforce is concentrated in senior positions requiring specialized expertise. The retirement of these employees results in the departure of decades of accumulated experience from federal service.
The high average age and lengthy service records mean that retirements are accelerating. This demographic profile explains why many of these workers are difficult to replace, as their specialized roles and experience are often not easily transferred to younger staff.
The Financial and Budgetary Impact of the Shrinking System
The shrinking CSRS population impacts federal budgeting and pension obligations. CSRS is a partially funded system, and the government manages a significant unfunded liability associated with benefits earned by active employees and current annuitants. The Civil Service Retirement and Disability Fund (CSRDF) holds assets, but the government must make payments to cover the long-term cost of these defined benefits.
The financial impact is also visible in employee contribution rates. Standard CSRS employees contribute 7% of their salary, a rate significantly higher than the 0.8% initial contribution rate for original FERS employees. Agencies employing CSRS workers thus have different budgetary requirements for employer-matching contributions.
The CSRDF balance was $1.1 trillion at the end of FY2022, projected to reach $1.576 trillion by the end of FY2032. The government’s long-term obligation remains a factor in federal financial planning. As the active workforce shrinks, fund management focuses primarily on administering benefits for the large annuitant population.
Future Projections for the End of CSRS
The active CSRS workforce is rapidly declining. With 44,000 active employees remaining in FY2022, and 11,119 retiring that year, the workforce is aging out at a pace of roughly 25% per year.
Since 91% of the remaining CSRS employees are age 60 or older, the number is expected to drop below 10,000 within a few years of the 2022 data. The active CSRS workforce is projected to effectively disappear as a meaningful demographic within the decade. The system itself will continue to exist for decades to pay benefits to millions of federal retirees and their survivors.
The “end” of CSRS refers solely to the retirement of the last active employee covered under the system. Once that final employee retires, the system will become fully closed, with no remaining active contributors.