Employer costs for employee compensation for civilian workers averaged $29.18 per hour worked in December 2008, the U.S. Department of Labor’s Bureau of Labor Statistics reported. Wages and salaries, which averaged $20.37, accounted for 69.8 percent of these costs, while benefits, which averaged $8.81, accounted for the remaining 30.2 percent.

Employer costs for legally required benefits averaged $2.27, or 7.8 percent of total compensation per hour worked in December 2008. Legally required benefits - which include Social Security, Medicare, federal and state unemployment insurance, and workers’ compensation - is only one of several benefit categories included in Employer Costs for Employee Compensation, along with wages and salaries. Employer Costs for Employee Compensation is a product of the National Compensation Survey, which measures employer costs for wages and salaries, and employee benefits for nonfarm private and state and local government workers.

Employer costs for insurance benefits - life, health, and disability - averaged $2.45 per hour (8.4 percent of total compensation). Paid leave benefits (vacations, holidays, sick leave, and personal) averaged $2.06 (7.1 percent); retirement and savings averaged $1.29 (4.4 percent); and supplemental pay averaged 74 cents (2.5 percent) per hour worked.

Private industry

In December 2008, private industry employer compensation costs averaged $27.35 per hour worked. Wages and salaries averaged $19.37 (70.8 percent), while benefits averaged $7.98 (29.2 percent). Employer costs for legally required benefits averaged $2.26 (8.3 percent) per hour worked, insurance benefits averaged $2.09 (7.6 percent), paid leave averaged $1.85 (6.8 percent), retirement and savings averaged 96 cents (3.5 percent), and supplemental pay averaged 81 cents (3.0 percent).

Legally required benefit costs in private industry

The average cost for legally required benefits was $2.26 per hour worked in private industry (8.3 percent of total compensation) in December 2008. Legally required benefit costs are often directly linked to wages; therefore, higher paid occupations or industries will typically show higher estimates for this compensation component. 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 $3.38 per hour for management, professional, and related occupations. The proportion of total compensation represented by legally required benefits ranged from 7.0 percent for management, professional, and related workers to 10.3 percent for natural resources, construction, and maintenance workers.

Employer costs for legally required benefits were significantly higher for union workers, $3.11 per hour, than for nonunion workers, $2.16 per hour. As a proportion of total compensation, legally required benefits accounted for 8.6 percent of total compensation for union workers, compared with 8.2 percent for nonunion workers.

Costs for legally required benefits were higher in goods-producing industries ($2.90 per hour, or 9.0 percent of total compensation) than in service-providing industries ($2.11 per hour, or 8.0 percent of total compensation). Within goods-producing industries, construction averaged $3.48 per hour worked (11.2 percent), higher than in manufacturing, at $2.60 per hour (8.2 percent). For workers’ compensation, a component of legally required benefits, costs were $1.42 per hour in construction, significantly higher than in manufacturing, at 57 cents per hour. Legally required benefit costs in service-providing industries ranged from $1.26 per hour for the leisure and hospitality industry (10.6 percent) to $2.86 for the information industry (7.1 percent).

Among the four census regions, employer costs for legally required benefits ranged from $1.95 in the South to $2.58 per hour in the Northeast. Legally required benefit costs were $2.18 in the Midwest, less than in the West, which was $2.55. Within the nine census divisions, costs for legally required benefits ranged from $1.78 in the East South Central division, to $2.71 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 $2.03, less than the cost of $2.50 in establishments with 100 employees or more. Legally required benefit costs in establishments with fewer than 50 employees averaged 9.0 percent of total compensation, and in establishments with 500 workers or more, 7.2 percent.

Paid leave benefit costs in private industry

Employer costs for paid leave benefits were highest for management, professional, and related occupations, $4.09 per hour, or 8.4 percent of total compensation, in December 2008. Costs were lowest among service occupations, 57 cents or 4.3 percent of total compensation. Included in this amount were employer costs for vacations, holidays, sick leave, and personal leave. Paid leave benefit costs are often directly linked to wages; therefore, higher paid occupations or industries will typically show higher estimates for this compensation component.

Employer cost for paid leave benefits averaged $2.65 per hour worked for union workers, significantly higher than the $1.76 per hour average for nonunion workers.

Paid leave costs in goods-producing industries were $2.05 (6.4 percent of total compensation), greater than the average for service-providing industries, $1.81 (6.9 percent of total compensation) in December 2008.

Among the nine census divisions, paid leave costs ranged from $1.26 in the East South Central division, to $2.47 in the New England division.

Paid leave benefits costs increased, both in average dollar amount and as a proportion of total compensation, with establishment size. Establishments with fewer than 100 workers averaged $1.24 per hour (5.5 percent); significantly less than those with 100 workers or more, $2.52 per hour (7.8 percent).