Benefits Reach 44% of Payroll in 2005

February 22, 2007 ( - Employee benefits reached 44% of payroll in 2005, with medical-related expenses constituting the greatest benefit cost at $5,924 per employee, according to a recent study from the U.S. Chamber of Commerce.

According to the annual Employee Benefits Study of 400 U.S. companies, the breakdown of benefits expenses as a percentage of payroll for 2005 are as follows:

  • Medical expenses were $5,924, or 14.5% of payroll in 2005, up 11.9% from the year before;
  • Payments for time not worked, such as paid holidays and paid time off, increased by 0.6% to 11.1% of payroll expenditures.
  • Retirement expenditures increased slightly to 8.6% of payroll, or $3,612 per employee annually.

Nonprofit firms spent less on benefits than their for-profit counterparts, spending on average 34.8% of total payroll on benefits.

The survey also found that companies in metropolitan areas spent $1,000 more per employee for paid time off and retirement payments than companies in non-metro areas. Metropolitan area firms also outspent non-metro companies in medical benefits payments by nearly $500 per employee.

To purchase the full study, visit .