Employer Costs for Employee Compensation News Release Text
Washington, DC (WorkersCompensation.com) - Private industry employers spent an average of $28.80 per hour worked for employee compensation in June 2012, the U.S. Bureau of Labor Statistics reported today. Wages and salaries averaged $20.27 per hour worked and accounted for 70.4 percent of these costs, while benefits averaged $8.52 and accounted for the remaining 29.6 percent. Total compensation costs for state and local government workers averaged $41.10 per hour worked in June 2012. Total compensation costs for civilian workers, which include private industry and state and local government workers, averaged $30.61 per hour worked in June 2012.
Employer Costs for Employee Compensation (ECEC), 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.
Retirement and savings benefit costs in private industry
In June 2012, average costs in private industry for retirement and savings benefits were $1.02 per hour worked, or 3.5 percent of total compensation. Private industry retirement and savings benefit costs for management, professional, and related occupations were $2.07 per hour, or 4.0 percent of total compensation in June 2012. Costs were lowest among service occupations, 22 cents or 1.6 percent of total compensation. (See table 5.) Included in retirement and savings benefit costs 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 National Compensation Survey produces comprehensive data on the percentage of workers with access to and that participate in retirement plans. Data for March 2012 are available at http://www.bls.gov/news.release/pdf/ebs2.pdf).
In June 2012, 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 43 cents (1.5 percent of total compensation). The average cost for defined contribution plans—retirement plans usually based on employer contributions to individual employee accounts—was 59 cents (2.1 percent of total compensation). (See table 5.)
Retirement and savings benefit costs were higher, both in amount and as a proportion of total compensation, for union workers ($2.89 and 7.4 percent of total compensation) than for nonunion workers (83 cents and 3.0 percent of total compensation). Defined benefit plan costs were significantly higher for union workers ($2.11 and 5.4 percent of total compensation) than for nonunion workers (26 cents and 0.9 percent of total compensation). Defined contribution costs for union workers were higher (78 cents) compared to nonunion workers (57 cents). (See table 5.)
Retirement and savings benefit costs increased, both in cost per hour worked and proportion of total compensation, with establishment employment size. Establishments with fewer than 100 workers averaged 62 cents per hour worked (2.6 percent of total compensation) for retirement and savings costs. Establishments with 100 to 499 workers averaged $1.09 per hour worked (3.7 percent), significantly less than establishments with 500 workers or more which averaged $2.09 (4.9 percent). Defined benefit costs ranged from 23 cents per hour worked for establishments with 1 to 99 workers to $1.00 per hour worked for 500 workers or more. Defined contribution costs also showed increases by establishment size from 39 cents per hour worked for 1 to 99 workers to $1.10 per hour worked for 500 workers or more. (See chart 1 and table 8.)
Employer retirement and savings benefit costs for full-time workers in private industry averaged $1.30 per hour worked (3.9 percent of total compensation), significantly higher than 23 cents for part-time workers (1.5 percent). Retirement and savings costs for full-time workers in management, professional, and related occupations averaged $2.26 per hour worked, compared with 71 cents for part-time workers. Employer retirement and savings benefits costs for service workers were significantly lower than all other occupational groups at 36 cents for full-time workers and 8 cents for part-time workers. (See chart 2 and table 11.)
Benefit costs in private industry
Private industry employer costs for legally required benefits (Social Security, Medicare, unemployment insurance, and workers’ compensation) averaged $2.37 per hour worked (8.2 percent of total compensation), insurance benefits (life, health, and disability insurance) averaged $2.34 (8.1 percent), paid leave (vacation, holiday, sick leave, and personal leave) averaged $1.97 (6.8 percent), and supplemental pay (overtime and premium, shift differentials, and nonproduction bonuses) averaged 82 cents (2.9 percent). (See table A and table 5.)
|Table A. Relative importance of employer costs for employee compensation, June 2012|
|Compensation Civilian Private State and local|
|component workers industry government|
|Wages and salaries 69.3% 70.4% 65.0%|
|Benefits 30.7 29.6 35.0|
|Paid leave 7.0 6.8 7.4|
|Supplemental pay 2.5 2.9 0.8|
|Insurance 8.9 8.1 12.1|
|Health benefits 8.5 7.7 11.7|
|Retirement and savings 4.5 3.5 8.5|
|Defined benefit 2.7 1.5 7.8|
|Defined contribution 1.8 2.1 0.7|
|Legally required 7.8 8.2 6.2|
The Employer Costs for Employee Compensation for September 2012 is scheduled to be released on Tuesday, December 11, 2012, at 10:00 a.m. (EST).
Employer Costs for Employee Compensation data on total compensation, wages and salaries, and benefits in private industry are produced annually in the March reference period for 15 metropolitan areas. The most recent metropolitan area data were included in the March 2012 news release published in June 2012. For further information about metropolitan area ECEC estimates see: “BLS Introduces New Employer Costs for Employee Compensation Data for Private Industry Workers in 15 Metropolitan Areas,” at http://www.bls.gov/opub/cwc/cm20090921ar01p1.htm.
Supplemental tables with occupational, establishment size, and bargaining status series for detailed industries are available at http://www.bls.gov/ncs/ect/sp/ecsuphst.pdf and http://www.bls.gov/ncs/ect/sp/ecsuptc23.pdf.
Relative standard errors for all cost estimates in the most recent news release and supplementary tables are available at ftp://ftp.bls.gov/pub/special.requests/ocwc/ect/ececrse.pdf and http://www.bls.gov/ncs/ect/sp/ecsuprse.pdf.
Historical ECEC data are available in three listings, all available at http://www.bls.gov/ect/#tables.The first historical listing covers data for the March reference periods from 1986 to 2001. These data use the Standard Industrial Classification (SIC) and Census of Population occupational classification systems. A second listing contains data for the March, June, September, and December reference periods from March 2002 to December 2003. These data are also based on the SIC and Census of Population occupational classification systems. The most recent listing includes data for March 2004 to the current reference period. These are based on the North American Industry Classification System (NAICS) and Standard Occupational Classification (SOC) systems.
Information in this release will be made available to sensory impaired individuals upon request— Telephone: (202) 691-5200; Federal Relay Service: (800) 877-8339.
BLS news releases, including the ECEC, are available through an e-mail subscription service at: www.bls.gov/bls/list.htm.
- Technical Note
- 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
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