EMPLOYER COSTS FOR EMPLOYEE COMPENSATION – JUNE 2014

In June private employers spent $1.23 per hour worked for employee retirement benefits

Private industry employers spent an average of $30.11 per hour worked for employee compensation in June 2014. Wages and salaries averaged $21.02 and benefits averaged $9.09, of which retirement and savings plans averaged $1.23 per hour worked.

Private industry employers spent an average of $30.11 per hour worked for employee compensation in  June 2014, the U.S. Bureau of Labor Statistics reported today. Wages and salaries averaged $21.02 per hour worked and accounted for 69.8 percent of these costs, while benefits averaged $9.09 and accounted for the remaining 30.2 percent. Total compensation costs for state and local government workers averaged $43.07 per hour worked in June 2014. Total compensation costs for civilian workers, which include private industry and state and local government workers, averaged $31.96 per hour worked in June 2014.

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.

              Corrected Data in Employer Costs for Employee Compensation

As a result of problems implementing the 2010 Standard Occupational Classification, Employer

Costs for Employee Compensation data for December 2013 and March 2014 contained errors

when originally published. These errors have been corrected in the database and historical listings.

The errors were primarily in the management, professional, and related occupational group and

sub-groups in civilian, private industry, and state and local government. There is no impact on

June 2014 estimates. For further information, see www.bls.gov/bls/ecec_correction_091014.htm.

Retirement and savings costs in private industry

In June 2014, average costs in private industry for retirement and savings benefits were $1.23 per

hour worked, or 4.1 percent of total compensation. The average cost per hour worked for defined

benefit plans— retirement plans that specify a benefit typically based on age, years of service, and earnings—was 58 cents or 1.9 percent of total compensation. The average cost for defined contribution plans—retirement plans usually based on employer contributions to individual employee accounts—was 65 cents or 2.2 percent of total compensation. (See table 5.) 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 2014 are available at www.bls.gov/news.release/pdf/ebs2.pdf).

Retirement and savings costs varied widely by major occupational group.  Costs for management, professional, and related workers were $2.61 per hour worked (4.9 percent of total compensation), compared to $2.00 for natural resources, construction, and maintenance workers (6.0 percent) and 22 cents for service workers (1.5 percent). (See chart 1 and table 5.)

Retirement and savings costs were higher both in amount and as a proportion of total compensation for union workers ($4.02 and 9.1 percent of total compensation) than for nonunion workers (95 cents and 3.3 percent of total compensation). Defined benefit plan costs were significantly higher for union workers ($2.97 and 6.7 percent of total compensation) than for nonunion workers (34 cents and 1.2 percent of total compensation).  (See table 5.)

Retirement and savings costs were higher per hour worked in goods-producing industries ($1.88 and 5.2 percent of total compensation) than in service-providing industries ($1.09 and 3.8 percent of total compensation). Within goods-producing industries, retirement and savings costs averaged $1.96 per hour in construction and $1.69 per hour in manufacturing. Costs in service-providing industries ranged from 18 cents in leisure and hospitality to $4.35 in the information industry. (See table 6.)

Retirement and savings costs increased both in cost per hour worked and proportion of total

compensation with establishment employment size. Establishments with fewer than 100 workers

averaged 72 cents (2.9 percent of total compensation), significantly less than establishments with 500 workers or more, averaging $2.60 (5.9 percent). (See chart 2 and table 8.)

Benefit costs in private industry

Private industry employer costs for paid leave averaged $2.08 per hour worked or 6.9 percent of total compensation, supplemental pay averaged 85 cents or 2.8 percent, insurance benefits averaged $2.49 or 8.3 percent, and legally required benefits averaged $2.44 per hour worked or 8.1 percent.  (See table A and table 5.)

Table A.  Relative importance of employer costs for employee compensation, June 2014

____________________________________________________________________________

Compensation                Civilian       Private      State and local

   component                workers        industry       government

___________________________________________________________________________

Wages and salaries          68.7%          69.8%            64.0%

Benefits                    31.3           30.2             36.0

   Paid leave               7.0            6.9              7.3

   Supplemental pay         2.4            2.8              0.8

   Insurance                9.0            8.3             12.0

     Health benefits        8.6            7.8             11.7

   Retirement and savings   5.2            4.1              9.9

     Defined benefit        3.3            1.9              9.0

     Defined contribution   1.9            2.2              0.8

   Legally required         7.7            8.1              5.9

___________________________________________________________________________

The Employer Costs for Employee Compensation for September 2014 is scheduled to be released on Wednesday, December 10, 2014, 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 for 15 metropolitan areas. Selected metropolitan area data were most recently included in the March 2014 news release published in June 2014. 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 www.bls.gov/opub/mlr/cwc/bls-introduces-new-employer-costs-for-employee-compensation-data-for-private-industry-workers-in-15-metropolitan-areas.pdf.

Supplemental tables with occupational, establishment size, and bargaining status series by industry group are available at www.bls.gov/ncs/ect/sp/ecsuphst.pdf and www.bls.gov/ncs/ect/sp/ecsuptc31.pdf.

Relative standard errors for all cost estimates in the most recent news release and supplementary tables are available at www.bls.gov/ncs/ect/sp/ecsuprse.pdf. 

Historical ECEC data are available in three listings at 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.  The 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 final 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.

• 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
• HTML version of the entire news release

The PDF version of the news release

Source: Bureau Labor Statistics