Federal Retirement Claims Backlog Peaks at 65,237 in 2026

Why It Matters

Federal retirement processing has deteriorated sharply in 2026, with a new Congressional Research Service (CRS) report documenting a backlog crisis that threatens the financial security of hundreds of thousands of former government workers. The retirement claims backlog peaked at 65,237 claims in February, more than 2.5 times the prior year's peak, while processing times surged to 109 days in July. For the roughly 2.8 million retirees and survivors receiving an estimated $114.8 billion in federal retirement benefits annually, delays translate directly into reduced interim payments capped at 60 to 80% of their eventual annuity, with no interest accruing on those delayed funds. Congress faces pressure to address both immediate backlogs and the underlying staffing and technology gaps that created them.

The Big Picture

The processing crisis stems from a combination of staffing losses and technology challenges that have plagued the Office of Personnel Management (OPM) for decades. OPM's Retirement Services workforce shrank 16% from fiscal year 2024 to fiscal year 2026, losing 165 full-time employees, while earlier reductions through the Deferred Resignation Program and Voluntary Early Retirement Authority further depleted Human Resources capacity across federal agencies. Attempts at technology modernization have faltered since the late 1980s, though OPM announced the "Last Day of Paper" on July 1, when more than 95% of retirement applications would move to digital processing.

The average monthly processing time for digital claims ranged from 34 days in February to 98 days in July, while in FY2026 through August, the monthly average retirement claims processing time has ranged from 60 days to a high of 109 days. Since March 2026, more than half of monthly retirement claims received have been digital. OPM Director Scott Kupor testified in March 2026 that digital processing was already achieving more than 50% reductions in adjudication times compared to mail-based retirements.