Charting employer costs for legally required benefits
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, the U.S. Department of Labor's Bureau of Labor Statistics reported. Included in this amount are employer costs for Social Security and Medicare, federal and state unemployment insurance, and workers’ compensation.
Health savings accounts must be used in conjunction with employer-provided, high-deductible health plans with an annual maximum limit on out-of-pocket and deductible expenses. Other features of health savings accounts include the rollover of unused contributions, the portability of accounts and tax-free interest.
Employer costs for legally required benefits were significantly higher for union workers, $3.15 per hour, than for non-union 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). 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).
This data comes from the Compensation Cost Trends program. For additional information, see “Employer Costs for Employee
Compensation–December 2006,” news release USDL 07-0453.