Employer costs for insurance benefits - life, health, and disability - averaged $2.26 per hour (8.2 percent of total compensation). Legally required benefits, including Social Security, Medicare, unemployment insurance, and workers’ compensation, averaged $2.20 per hour (8.0 percent of total compensation); paid leave benefits (vacations, holidays, sick leave, and other leave) averaged $1.94 (7.0 percent); and retirement and savings benefits averaged $1.21 (4.4 percent) per hour worked.
Private industry
In December 2006, private industry employer compensation costs averaged $25.67 per hour worked. Wages and salaries averaged $18.11 per hour (70.5 percent), while benefits averaged $7.57 (29.5 percent). Employer costs for legally required benefits averaged $2.20 (8.6 percent) per hour worked, insurance benefits averaged $1.92 (7.5 percent), paid leave averaged $1.76 (6.8 percent), retirement and savings averaged 94 cents (3.7 percent), and supplemental pay averaged 75 cents (2.9 percent).
Legally required benefit costs in private industry
The average cost for legally required benefits was $2.20 per hour worked in private industry (8.6 percent of total compensation) in December 2006. Included in this amount are employer costs for Social Security and Medicare, federal and state unemployment insurance,
and workers’ compensation.
Employer costs for legally required benefits varied by occupation, industry, bargaining status, region, and establishment size. The average cost per hour worked for legally required benefits ranged from $1.36 per hour worked for service occupations to $3.24 per hour for management, professional, and related occupations. Natural resources, construction, and maintenance occupations averaged $3.09; production, transportation, and material moving occupations, $2.22; and sales and office occupations, $1.66 per hour. The proportion of
total compensation represented by legally required benefits ranged from 7.1 percent for management, professional, and related workers to 10.7 percent for service workers and natural resources, construction, and maintenance workers.
Employer costs for legally required benefits were significantly higher for union workers, $3.15 per hour, than for nonunion workers, $2.09 per hour. As a proportion of total compensation, legally required benefits accounted for 8.8 percent of total compensation for union workers, compared with 8.5 percent for nonunion workers.
Costs for legally required benefits were higher in goods-producing industries ($2.81 per hour or 9.4 percent of total compensation) than in service-providing industries ($2.04 per hour or 8.3 percent of total compensation). Within goods-producing industries, construction
averaged $3.30 per hour worked (11.6 percent), higher than in manufacturing, at $2.55 per hour (8.4 percent). For a component of legally required benefits, workers’ compensation, costs were $1.38 per hour in construction, significantly higher than in manufacturing, $0.61
per hour. Legally required benefit costs in service-providing industries ranged from $1.23 per hour for the leisure and hospitality industry (11.1 percent) to $2.71 for the information industry (7.1 percent).
Among the four regions, employer costs for legally required benefits ranged from $1.90 per hour in the South to $2.54 per hour in the West. Legally required benefit costs were $2.11 in the Midwest and $2.45 in the Northeast. Within the nine census divisions, costs for legally required benefits ranged from $1.73 in the East South Central division, to $2.75 in the Pacific division.
Legally required benefit costs increased in average dollar amount per hour with establishment size. In establishments with fewer than 100 employees, average hourly costs were $1.98, less than the cost of $2.44 in establishments with 100 employees or more. Conversely, legally required costs decreased as a proportion of total compensation with establishment size. Legally required benefit costs in establishments with fewer than 50 employees averaged 9.4 percent; and in establishments with 500 workers or more, 7.4 percent
of total compensation.
Paid leave benefit costs in private industry
Employer costs for paid leave benefits were highest for management, professional, and related occupations, $3.87 per hour, or 8.5 percent of total compensation in December 2006. Costs were lowest among service occupations, 58 cents or 4.5 percent of total compensation.
Included in this amount were employer costs for vacations, holidays, sick leave, and other leave, such as personal leave, jury duty leave, military leave, and funeral leave.
Employer costs for paid leave benefits averaged $2.81 per hour for union workers, significantly higher than the $1.63 per hour average for nonunion workers.
Paid leave costs in goods-producing industries were $1.92 per hour (6.4 percent of total compensation), greater than the average for service-providing industries, $1.71 (7.0 percent of total compensation) in December 2006.
Among the nine census divisions, paid leave costs ranged from $1.17 in the East South Central division, to $2.19 and $2.28 in the New England and Middle Atlantic divisions, respectively.
Paid leave benefit costs increased, both in average dollar amount and as a proportion of total compensation, with establishment size. Establishments with fewer than 100 workers averaged $1.14 per hour (5.4 percent); significantly less than those with 100 workers or more, $2.41 per hour (7.9 percent).
