Medical benefits top retirement as costliest employee benefit
Medically related benefits accounted for the largest share of employer benefit costs at 12.1 percent and retirement benefits followed by 10.4 percent, according to the 2007 Employee Benefits Study recently released by the United States Chamber of Commerce. Payments for vacation, holidays, and other paid time off resulted in 9.8 percent of employer benefit costs.
"Research shows that many employees consider benefits as important as salary," said Randel Johnson, Chamber's vice president for Labor, Immigration & Employee Benefits. "In a competitive labor market, businesses are challenged to offer benefit packages that attract and retain high-quality workers."
The Chamber's study also shows that geography plays an integral role in benefit costs. Businesses in metropolitan areas spent $3,600 more per employee for medical care and $4,400 more per employee for retirement payments than companies in non-metropolitan areas.
The average dollar amount in benefits received by employees from the participating companies increased from $18,489 in 2005 to $21,527 in 2006. "Employees are becoming increasingly aware of their benefits and how they compare with offerings from other companies," added Johnson.
More than 400 U.S. companies participated in the study, and more than 30 different types of benefits were analyzed by industry, company size, geographic region, and for-profit or nonprofit status. The Chamber has produced the annual survey for more than 50 years to help business owners and executives evaluate their company's benefits package, determine how it compares with others, and assess the costs of providing benefits.
The 2008 Employee Benefits Survey is currently underway. To participate, go to the U.S. Chamber of Commerce's survey Web site, click on the link "Take the Survey", and then register for a new account. All participants that complete the survey will receive a complimentary copy ($125 value) of the 2008 Employee Benefits Study when it is released in early 2009.
The U.S. Chamber is the world's largest business federation representing more than 3 million businesses and organizations.