Employer Costs for Employee Compensation Summary
Technical Contact: USDL: 08-1271 (202) 691-6199 NCSinfo@bls.gov Media Contact: FOR RELEASE: 10:00 AM EDT (202) 691-5902 WEDNESDAY, SEPTEMBER 10, 2008 Internet Address: http://www.bls.gov/ect EMPLOYER COSTS FOR EMPLOYEE COMPENSATION-JUNE 2008 Employers spent an average of $1.25 for employee retirement and savings plans for every hour worked in June 2008, the U.S. Department of Labor’s Bureau of Labor Statistics reported today. This accounted for 4.4 percent of total compensation. Retirement and savings, which includes both defined benefit and defined contribution plans, is only one of several benefits included in the Employer Costs for Employee Compensation survey, along with wages and salaries. Total compensation (wages and salaries and benefits) for civilian workers averaged $28.48 per hour worked in June 2008. Wages and salaries, which averaged $19.85, accounted for 69.7 percent of these costs, while benefits, which averaged $8.64, accounted for the remaining 30.3 percent. (See table 1.) The Employer Costs for Employee Compensation program, a product of the National Compensation Survey, measures employer costs for wages, salaries, and employee benefits for nonfarm private and state and local government workers. In addition to retirement and savings the other benefit categories were: life, health, and disability insurance benefits, which averaged $2.39 (8.4 percent of total compensation); legally required benefits, including Social Security, Medicare, unemployment insurance, and workers’ compensation, which averaged $2.25 per hour (7.9 percent); paid leave benefits (vacations, holidays, sick leave, and personal leave), which averaged $1.99 (7.0 percent); and supplemental pay which averaged 76 cents (2.7 percent). Private industry In June 2008, private industry employer compensation costs averaged $26.78 per hour worked. Wages and salaries averaged $18.92 per hour (70.6 percent), while benefits averaged $7.86 (29.4 percent). Employer costs for paid leave averaged $1.78 per hour worked (6.7 percent), supplemental pay averaged 83 cents (3.1 percent), insurance benefits averaged $2.05 (7.7 percent), retirement and savings averaged 95 cents (3.6 percent), and legally required benefits averaged $2.24 (8.4 percent) per hour worked. (See table 5.) Retirement and savings benefit costs in private industry In June 2008, average costs in private industry for retirement and savings benefits were 95 cents per hour worked, or 3.6 percent of total compensation. The average cost per hour worked for defined benefit plans--retirement plans that typically specify a benefit based on age, years of service, and earnings--was 42 cents (1.6 percent of total compensation). The average cost for defined contribution plans--retirement plans usually based on employer contributions to individual employee accounts--was 53 cents (2.0 percent of total compensation). (See table 5.) Employer costs for retirement and savings plans are affected by several factors, including the percentage of employees that have access to and participate in the plans offered by their employer. (The National Compensation Survey produces comprehensive data on the percentage of workers with access to and participation in retirement plans. Data for March 2008 were recently released and are available at http://www.bls.gov/news.release/pdf/ebs2.pdf). ___________________________________________________________________________________________________ NOTE Effective with the December 2008 release, series for metropolitan and nonmetropolitan areas in table 7 will be discontinued. ___________________________________________________________________________________________________ Among occupational groups, retirement and savings costs ranged from 22 cents per hour worked for service occupations to $1.94 for management, professional, and related occupations. Sales and office occupations averaged 61 cents; production, transportation, and material moving occupations, 87 cents; and natural resources, construction, and maintenance occupations, $1.42 per hour. The proportion of total compensation represented by retirement and savings ranged from 1.6 percent for service workers to 4.7 percent for natural resources, construction, and maintenance workers. (See table 5.) Retirement and savings costs were higher, both in amount and as a proportion of total compensation, for union workers ($2.44 and 6.7 percent of total compensation) than for nonunion workers (78 cents and 3.0 percent of total compensation). Defined benefit plan costs were significantly higher for union workers ($1.73 and 4.8 percent of compensation) than for nonunion workers (27 cents and 1.0 percent of compensation). (See table 5.) Retirement and savings costs were higher per hour worked in goods-producing industries ($1.45 and 4.6 percent of total compensation) than in service-providing industries (83 cents and 3.2 percent of total compensation). Retirement costs within goods-producing industries averaged $1.54 per hour in construction and $1.31 per hour in manufacturing. Costs in service-providing industries varied widely, ranging from 13 cents in leisure and hospitality to $1.49 in information and $1.51 in the financial activities industry. (See table 6.) Among the four census regions, retirement and savings costs ranged from 84 cents per hour in the South to $1.14 in the Northeast. Retirement and savings costs were 97 cents in the West and 95 cents in the Midwest. Within the nine census divisions, retirement and savings costs ranged from 53 cents in the East South Central division to $1.19 in the Middle Atlantic division. (See table 7.) Retirement and savings costs increased, both in cost per hour worked and proportion of total compensation, with establishment size. Establishments with fewer than 50 workers averaged 50 cents (2.3 percent), significantly less than establishments with 500 workers or more, averaging $1.89 (5.0 percent). (See table 8.) Since June 2003, private industry retirement and savings costs have changed in terms of total compensation percentage from 3.0 to 3.6 percent. Defined benefit cost percentages in June 2003 were 1.1 percent of total compensation compared with 1.6 percent currently while defined contribution percentages were similar at 1.9 percent versus 2.0 percent. ___________________________________________________________________________________________________ NOTE The Employer Costs for Employee Compensation news release for September 2008 is scheduled for Wednesday, December 10, 2008, at 10:00 AM (EST). ___________________________________________________________________________________________________ Table of Contents: Table 1. Civilian workers, by major occupational and industry group 5 Table 2. Civilian workers, by occupational and industry group 7 Table 3. State and local government workers, by major occupational and industry group 8 Table 4. State and local government workers, by occupational and industry group 9 Table 5. Private industry workers, by major occupational group and bargaining unit status 10 Table 6. Private industry workers, by major industry group 12 Table 7. Private industry workers, by census region and division, and area 14 Table 8. Private industry workers, by establishment employment size 17 Table 9. Private industry workers, goods-producing and service-providing industries, by occupational group 18 Table 10. Private industry workers, by industry group 19 Table 11. Private industry workers, by occupational group and full-time and part-time status 20 Table 12. Private industry workers, by industry group and full-time and part-time status 21 Table 13. Private industry workers, by major industry group and establishment employment size and bargaining unit status 22 Table 14. Private industry health care and social assistance workers, by industry and occupational group 23 Technical Note 24 Note: Supplemental tables with occupational, establishment size, and bargaining status series for detailed industries are available at http://www.bls.gov/ncs/ect/sp/ecsuptc7.pdf and http://www.bls.gov/ncs/ect/sp/ecsuptc7.txt.
- Table 1. Civilian workers, by major occupational and industry group
- Table 2. Civilian workers, by occupational and industry group
- Table 3. State and local government, by major occupational and industry group
- Table 4. State and local government, by occupational and industry group
- Table 5. Private industry, by major occupational group and bargaining status
- Table 6. Private industry, by major industry group
- Table 7. Private industry, by census region and division, and area
- Table 8. Private industry, by establishment employment size
- Table 9. Private industry, goods-producing and service-providing industries, by occupational group
- Table 10. Private industry, by industry group
- Table 11. Private industry, by occupational group and full-time and part-time status
- Table 12. Private industry, by industry group and full-time and part-time status
- Table 13. Private industry, by major industry group and establishment employment size and bargaining status
- Table 14. Private industry, health care and social assistance workers, by industry and occupational group
- Explanatory Notes
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Last Modified Date: September 10, 2008