Cost of Benefits Increased to 4% in Past Year

July 29, 2011 (PLANSPONSOR.com) - Compensation costs for civilian workers increased 0.7%, seasonally adjusted, for the three-month period ending June 2011, the U.S. Bureau of Labor Statistics reported.

Wages and salaries (which make up about 70% of compensation costs) increased 0.4%, and benefits (which make up the remaining 30% of compensation) increased 1.3%.  

Compensation costs for civilian workers increased 2.2% for the 12-month period ending June 2011. A year earlier—in June 2010—the increase was 1.9%. Wages and salaries increased 1.6% for the current 12-month period; the same as the June 2010 increase. Benefit costs accelerated to 3.6%, up from 2.5% for the 12-month period ending June 2010.  

Compensation costs for private industry workers increased 2.3% over the year, compared to the 1.9% increase for the previous 12-month period. The wage and salary series increased 1.7% for the current 12-month period.  The change for the 12-month period ending June 2010 was 1.6%. The increase in the cost of benefits jumped to 4% for the 12-month period ending June 2011, higher than the June 2010 increase of 2.4%. Employer costs for health benefits increased 3.6% for the 12-month period ending June 2011. In June 2010, the 12-month percent change was 5%.  

Among occupational groups, compensation cost increases for private industry workers for the 12-month period ending June 2011 ranged from 1.8% for service occupations to 2.7% for production, transportation and material moving occupations.  

Among industry supersectors, compensation cost increases for private industry workers for the current 12-month period ranged from 1.1% for leisure and hospitality to 3.3% for manufacturing.  Since September 2005, estimates for manufacturing have ranged from 1% in December 2009 to 3.2% in both September 2005 and December 2005.  

State and Local Government Workers  

Compensation costs for State and local government workers increased 1.7% for the 12-month period ending June 2011, which was the same as the increase for the 12-month period ending June 2010, according to the BLS report.  

Values for this series—which began in June 1982—have ranged from 1.7% in both June 2010 and the current reference period to 9.6% in June 1982. Wages and salaries increased 1.2% for the 12-month period ending June 2011. A year earlier the increase was 1.3%.   

Prior values for this series, which also began in June 1982, ranged from 1.2% for the past four quarters to 8.5% in June 1982. Benefit costs increased 3%; in June 2010 the increase was 2.5%. Prior values for this series, which began in June 1990, ranged from 1.2% in December 1997 to 8.3% in June 1990.  

The BLS report is at http://www.bls.gov.

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