Costs for legally required benefits, including Social Security, Medicare, unemployment insurance, and workers compensation, averaged $2.24 per hour (7.9 percent of total compensation). Employer costs for life, health, and disability insurance benefits averaged $2.40 (8.4 percent); paid leave benefits (vacations, holidays, sick leave, and other leave) averaged $2.00 (7.0 percent); and retirement and savings benefits averaged $1.26 (4.4 percent) per hour worked.
Health benefit costs in private industry
The average cost for health benefits was $1.92 per hour worked in private industry (7.2 percent of total compensation) in March 2008. In March 2003, employer costs for health benefits averaged $1.41, or 6.3 percent of total compensation.
Among occupational groups, employer costs for health benefits ranged from 90 cents per hour and 6.8 percent of total compensation for service workers to $2.77 and 5.8 percent of total compensation for management, professional, and related occupations. Among other occupational categories, employer costs for health benefits averaged $1.67 (7.9 percent) for sales and office occupations, lower than $2.30 (7.6 percent) for natural resources, construction, and maintenance occupations, and $2.21 (9.6 percent) for production, transportation, and material moving occupations.
Employer costs for health benefits were significantly higher for union workers, averaging $3.95 per hour (10.9 percent), than for nonunion workers, averaging $1.68 (6.5 percent). In goods-producing industries, health benefit costs were higher, $2.68 per hour (8.5 percent of total compensation), than in service-providing industries, $1.73 per hour (6.8 percent of total compensation).
Within goods-producing industries, health insurance costs were $2.91 per hour (9.3 percent of total compensation) for manufacturing workers, greater than the cost for construction workers ($2.09 and 6.9 percent of compensation.) Service-providing industries varied greatly in costs, ranging from 61 cents in leisure and hospitality (5.2 percent), to $2.60 in the financial activities industry (7.3 percent) and $2.90 in the information industry (7.4 percent).
Among the four regions, costs for health benefits ranged from $1.65 per hour in the South to $2.12 in the Northeast. Health care costs were $2.06 in the Midwest and $1.99 in the West. The proportion of total compensation represented by health benefits was 6.9 percent in the West, South and Northeast, and 7.9 percent in the Midwest. Within census divisions, hourly health benefit costs ranged from $1.56 in the West South Central division, to $2.17 in the Middle Atlantic and East North Central divisions.
Health benefit costs increased, both in average hourly dollar amount and as a proportion of total compensation, with establishment size. Establishments with fewer than 50 workers averaged $1.26 (5.8 percent), those with 50-99 workers averaged $1.64 (7.0 percent), those with 100-499 employees averaged $2.12 (7.9 percent), and those with 500 or more employees averaged $3.01 (8.0 percent).
Private industry
In March 2008, private industry employer compensation costs averaged $26.76 per hour worked. Wages and salaries averaged $18.91 per hour (70.6 percent), while benefits averaged $7.86 (29.4 percent). Employer costs for paid leave averaged $1.80 per hour worked (6.7 percent), supplemental pay averaged 80 cents (3.0 percent), insurance benefits averaged $2.06 (7.7 percent), retirement and savings averaged 96 cents (3.6 percent), and legally required benefits $2.24 (8.4 percent) per hour worked.
