Most DB pensions are Years x Pay x Factor (factor is usually around 1-1.3%). When you quit, obviously your years freeze - but the pay used in the calculation also freezes.
If you stay, each year your pay goes up (around inflation) and your years go up.
I used Dave's method when I was trying to make this decision. The "Pay" in his formula is often "average of highest __ months of consecutive salary". I'll do an example using some guesses about your situation.
Maybe you've been with your current employer 7 years, your "average" pay is $60,000 per year, and the "factor" is 1.0%.
In this case, your annual pension is 7 x $60,000 x 1.0% = $4,200.
If you stay one year, and your average pay goes up 3.33% during that time, the new calculation will be 8 x $62,000 x 1.0% = $4,960.
Using BGF's method, with an life expectancy of 18 years and a discount rate of 6%, the PV of the $4,960 at 62 is $53,705.
This is $8,229 more than the $45,476 that he calculated for the $4,200 pension.
If you discount the $8,229 for 12 years, you get $4,090.
So, if all the numbers in the example were correct, your pension would add a little over $4,000 to this year's compensation.
I like the one year calculation because it recognizes that the decision to stay isn't necessarily irrevocable.
Some warnings about this approach:
I'm assuming that your estimate of $1,000 per month if you stay did not include future raises. I'm using raises for this year and recent years in this calculation.
If I use Mikeyd's approach of equating a pension to an annuity, the value of the pension is about 20% higher.
This approach will show increased annual value as you get older. The reason is twofold - each year's raise is multiplied by a bigger number of years, and the discount to age 62 shrinks. Hence, older workers feel more "locked in" when they've got traditional pension plans.