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EMPLOYER COSTS FOR EMPLOYEE COMPENSATION-JUNE 2009
Employers spent an average of $1.29 for employee retirement and savings plans for every hour worked in
June 2009, the U.S. Department of Labor’s Bureau of Labor Statistics reported today. This accounted for
4.4 percent of total compensation. Retirement and savings, which includes both defined benefit and defined
contribution plans, is one benefit category included in the Employer Costs for Employee Compensation series,
along with wages and salaries. Total compensation (wages and salaries and benefits) for civilian workers
averaged $29.31 per hour worked in June 2009. Wages and salaries, which averaged $20.42, accounted for
69.7 percent of these costs, while benefits, which averaged $8.89, accounted for the remaining 30.3 percent.
(See table 1.) Employer Costs for Employee Compensation, 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.
In addition to retirement and savings, the other benefit categories were: life, health, and disability
insurance benefits, which averaged $2.50 (8.5 percent of total compensation); legally required benefits,
including Social Security, Medicare, unemployment insurance, and workers’ compensation, which averaged
$2.28 per hour (7.8 percent); paid leave benefits (vacations, holidays, sick leave, and personal leave), which
averaged $2.07 (7.1 percent); and supplemental pay which averaged 76 cents (2.6 percent).
Private industry
In June 2009, private industry employer compensation costs averaged $27.42 per hour worked. Wages and
salaries averaged $19.39 per hour (70.7 percent), while benefits averaged $8.02 (29.3 percent). Employer
costs for paid leave averaged $1.85 per hour worked (6.8 percent); supplemental pay averaged 83 cents
(3.0 percent); insurance benefits averaged $2.13 (7.8 percent); retirement and savings averaged 95 cents
(3.4 percent); and legally required benefits averaged $2.26 (8.3 percent) per hour worked. (See table 5.)
Retirement and savings benefit costs in private industry
In June 2009, average costs in private industry for retirement and savings benefits were 95 cents per
hour worked, or 3.4 percent of total compensation. The average cost per hour worked for defined benefit
plans--retirement plans that typically specify a benefit based on age, years of service, and earnings--was
41 cents (1.5 percent of total compensation). The average cost for defined contribution plans--retirement
plans usually based on employer contributions to individual employee accounts--was 53 cents (1.9 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 participation in retirement plans. Data for March 2009 were recently released and are available at
http://www.bls.gov/news.release/pdf/ebs2.pdf).
Among occupational groups, retirement and savings costs ranged from 21 cents per hour worked for service
occupations to $1.89 for management, professional, and related occupations. Sales and office occupations
averaged 60 cents; production, transportation, and material moving occupations, 84 cents; and natural resources,
construction, and maintenance occupations, $1.50 per hour. The proportion of total compensation represented by
retirement and savings ranged from 1.6 percent for service workers to 4.8 percent for natural resources,
construction, and maintenance workers. (See table 5.)
Retirement and savings costs were higher, both in amount and as a proportion of total compensation, for
union workers ($2.44 and 6.6 percent of total compensation) than for nonunion workers (77 cents and 2.9 percent
of total compensation). Defined benefit plan costs were significantly higher for union workers ($1.75 and
4.7 percent of compensation) than for nonunion workers (25 cents and 1.0 percent of compensation). (See table 5.)
Retirement and savings costs were higher per hour worked in goods-producing industries ($1.46 and 4.5 percent
of total compensation) than in service-providing industries (83 cents and 3.2 percent of total compensation).
Retirement costs within goods-producing industries averaged $1.65 per hour in construction and $1.28 per hour in
manufacturing. Costs in service-providing industries varied widely, ranging from 11 cents in leisure and
hospitality to $1.52 in the financial activities industry. (See table 6.)
Among the four census regions, retirement and savings costs ranged from 77 cents per hour in the South to
$1.18 in the Northeast. Retirement and savings costs were $1.02 in the West and 94 cents in the Midwest.
Within the nine census divisions, retirement and savings costs ranged from 54 cents in the East South Central
division to $1.19 in the Middle Atlantic division. (See table 7.)
Retirement and savings costs increased, both in cost per hour worked and proportion of total compensation,
with establishment size. Establishments with fewer than 50 workers averaged 49 cents (2.2 percent), significantly
less than establishments with 500 workers or more, averaging $1.92 (4.9 percent). (See table 8.)
Since June 2004, private industry retirement and savings costs in proportion to total compensation were
similar at 3.5 percent versus 3.4 percent currently. Defined benefit cost percentages in June 2004 were 1.7
percent of total compensation compared with 1.5 percent in June 2009 while defined contribution percentages were
similar at 1.8 percent versus 1.9 percent. In comparison, state and local government retirement and savings
costs in terms of total compensation have increased from 6.2 percent in June 2004 to 8.0 percent currently. State
and local government defined benefit costs have increased in terms of percent of total compensation from 5.5 percent
in June 2004 to 7.2 percent in June 2009 while defined contribution percentages were similar at 0.7 percent versus
0.8 percent.
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NOTE
The Employer Costs for Employee Compensation news release for September 2009 is scheduled for Wednesday,
December 9, 2009, at 10:00 AM (EST).
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Table of Contents:
Table 1. Civilian workers, by major occupational and industry group 5
Table 2. Civilian workers, by occupational and industry group 7
Table 3. State and local government workers, by major occupational
and industry group 8
Table 4. State and local government workers, by occupational and
industry group 9
Table 5. Private industry workers, by major occupational group and
bargaining unit status 10
Table 6. Private industry workers, by major industry group 12
Table 7. Private industry workers, by census region and division 14
Table 8. Private industry workers, by establishment employment size 17
Table 9. Private industry workers, goods-producing and
service-providing industries, by occupational group 18
Table 10. Private industry workers, by industry group 19
Table 11. Private industry workers, by occupational group and
full-time and part-time status 20
Table 12. Private industry workers, by industry group and full-time
and part-time status 21
Table 13. Private industry workers, by major industry group and
establishment employment size and bargaining unit status 22
Table 14. Private industry health care and social assistance workers,
by industry and occupational group 23
Technical Note 24
Note: Supplemental tables with occupational, establishment size, and bargaining status series for detailed
industries are available at http://www.bls.gov/ncs/ect/sp/ecsuptc11.pdf and http://www.bls.gov/ncs/ect/sp/ecsuptc11.txt.
