The latest federal data shows that benefits costs account for about 30% of employees’ total wages, as private-sector employers spent an average of $28.13 per hour worked for employee compensation in June 2011. Further, the Bureau of Labor Statistics reports, wages and salaries averaged $19.81 per hour worked and accounted for 70.4% of these costs, while benefits averaged $8.32 and accounted for the remaining 29.6%.
In June 2011, average costs in private industry for retirement and savings benefits were $1.03.
per hour worked, or 3.7% of total compensation. Private industry retirement and savings benefit costs for management, professional and related occupations were 4.1% of total compensation, with costs lowest among service occupations, 1.6% of total compensation. Included in this amount were employer costs for defined-benefit and defined-contribution plans.
Employer costs for retirement and savings plans are affected by several factors, including the percentage of employees that participate in the plans offered by their employer.
The average cost per hour worked for defined benefit plans was 1.6% of total compensation and the average cost for defined contribution plans was 2% of total compensation.
Retirement and savings costs increased, both in cost per hour worked and proportion of total compensation, with establishment size. Establishments with fewer than 100 workers averaged 2.6% of total compensation. Establishments with 100 to 499 workers averaged 3.6%, significantly less than establishments with 500 workers or more which averaged 5.4%.
Private industry employer costs for paid leave (vacation, holiday, sick leave and personal leave) averaged $1.90 per hour worked (6.7%), supplemental pay averaged 2.8%, insurance benefits averaged 8.1%, and legally required benefits (Social Security, Medicare, unemployment insurance and workers’ compensation averaged 8.3 %.
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