Employee benefits make up nearly 30% of compensation packages in the private sector, with insurance benefits comprising 8% of that total, according to 2010 research by the U.S. Bureau of Labor Statistics.
Overall, employers in the private sector allocated, on average, $19.68 per hour on
For example, private-sector employers spent $2.31 per hour worked on legally mandated benefits, which includes Social Security, Medicare, unemployment insurance and workers’ compensation. This category represented 8.3% of total compensation.
The majority of insurance costs ($2.24) stemmed from health insurance, which costs $2.10 per hour worked. The remaining balance was tagged for life, short-term disability and long-term disability. On the retirement side, defined benefit and defined contribution plans cost private-sector employers 99 cents, totaling 3.6% of total compensation.
Meanwhile, paid-leave benefits, such as vacations, holidays, sick leave and personal leave, averaged $1.88 per hour, which composed of 6.7% of total compensation. Supplemental compensation categorized as overtime and premium pay, shift differentials and non-production bonuses averaged 78 cents, totaling 2.8% of total compensation.
The research on benefits costs is outlined in the memo report "
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