Growth in Benefits Outpaced Wages Again in Third Quarter

Employee Benefits News examines legal developments that impact the employee benefits and executive compensation employers provide, including federal and state legislation, rules from federal...

By Larry Swisher

Dec. 9 — Increases in employer-provided benefits outpaced growth in wages and salaries over the 12 months ended in the third quarter, continuing a decade-long pattern, a Labor Department report showed.

Average hourly benefit costs for full-time workers rose 5 percent from a year earlier to $11.71 per hour, while pay climbed 4.1 percent to $25.18 per hour. Total compensation costs reached $36.90 in the third quarter, up 4.4 percent from a year earlier, according to the report issued Dec. 9.

The share of total compensation going to benefits rose to 31.7 percent from 31.6 percent, while the share going to wages and salaries declined to 68.3 percent from 68.4 percent. Benefits include health insurance, retirement plans and government-required contributions to social insurance.

Over the past five years since the third quarter of 2010, benefit costs have grown 19.6 percent while wages and salaries have increased 13.7 percent, Bloomberg BNA's analysis of the data showed. Total compensation for full-time workers was up 15.6 percent.

Union Pay Climbs

Among all workers, including those employed part-time, total compensation rose more for unionized than for nonunion employees over the 12 months ended in the third quarter (5.2 percent versus 3.8 percent), according to Bloomberg BNA's analysis.

Over the year ended in the third quarter, non-union workers' benefits rose more than those of their union counterparts (4.5 percent versus 3.6 percent), while pay grew more for union-represented than for nonunion employees (6.3 percent versus 3.4 percent).

Average hourly total compensation costs were significantly higher for union workers than those for non-union workers ($46.38 versus $30.04). The disparity may reflect differences in the industry and occupational make-ups of the union and non-union workforces, as well as the high proportion of non-unionized part-time workers, who are less likely than full-time employees to have employer-provided benefits.

Unions represent about 12.3 percent of all workers, including those employed in government, but only 7.4 percent of private sector employees, according to Labor Department figures.

To contact the reporter on this story: Larry Swisher in Washington at

To contact the editor responsible for this story: Susan J. McGolrick at

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