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August, 1988, Vol. 111, No. 8

Measuring the cost and incidence
of employee benefits

Janet L. Norwood

Employee compensation has changed dramatically in recent years. As inflation has decelerated and industry has undergone restructuring, wage and salary increases have moderated. Increases in the employer cost of benefits also have slowed, but discussion about the range of benefits offered to workers has picked up significantly.¹

The generation of workers born after World War II now accounts for a substantial proportion of the labor force. Like their working parents, these workers are concerned about rising health care costs, job security, and future retirement income. In addition, more women than ever before in our history have entered the labor force, many of them mothers of small children. This development has focused national attention on the interaction of work and the family. The combination of these demographic, social, and economic changes has resulted in a reexamination of employee compensation, which now encompasses a number of emerging benefits.

As a result, the measurement of total compensation to workers has become not only more important but also more difficult. This article discusses some of the problems in measuring the incidence and employer costs of benefits which are becoming more flexible, increasingly more integrated, and innovative at a time when employer cost-cutting initiatives are gaining momentum.

This excerpt is from an article published in the August 1988 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.

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Footnotes

1 See Bradley R. Braden, "Increases in employers' benefit costs dampened dramatically in the 1980's," Monthly Labor Review, July 1988, pp.3-7.

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