Aside from findings that lower earners have less access to retirement and health benefits and have lower participation rates when they do have benefits access, the BLS’ survey found that employers contribute more toward benefits of higher-paid employees. The BLS obtained similar findings about life insurance, holiday, and vacation benefits.
A report on its findings from the National Compensation survey says 31% of civilian workers in the lowest 10% of the national earnings range had access to defined contribution retirement plans, compared with 68% of workers in the highest 10% earnings category. For those who did have access, 40% of the lowest-paid workers participated, compared with 80% of the highest paid workers.
The BLS said the low take-up rate for lower-paid workers is likely due, in part, to the requirement for workers to contribute to the plan. It found that 72% of the lowest-paid workers were in plans that required them to contribute, compared to 66% of the highest wage earners. Eighty-seven percent of the low earners were in plans that required pre-tax deferrals, compared with 81% of high earners.
Similarly, the survey found 6% of workers in the lowest wage category had access to defined benefit retirement plans, while 54% of workers in the highest wage category had access to a DB plan. Take-up rates were 69% for low wage earners and 95% for high wage earners.
Access and participation rates for health care benefits followed a similar pattern as for retirement benefits. According to the report, medical care benefits were available to 26% of the lowest wage earners, compared to 92% of the highest wage earners.
Typically, dental care and outpatient prescription drug coverage were not offered to workers in the lowest wage category, but were offered to a majority of workers in the highest wage category. Ten percent of the lowest-paid workers were offered vision care, compared to 44% of the highest-paid workers.
The survey also found that for single coverage, employers contributed 85% of the cost for high-paid workers and 75% for the lowest paid. For family coverage, the amounts contributed by employers were 76% and 61%, respectively.
In addition, for single coverage, the BLS found that workers in the top 10% of the earnings range paid about $11 a month less for coverage than the lowest-paid workers ($85.47 vs. $96.89), and the employer contributed about $100 a month more for the highest-paid workers ($344.14 vs. $248.09). For family coverage, the highest-paid workers contributed about $60 a month less than the lowest-paid, while the employer contributed about $280 a month more for the highest-paid.
For life insurance, 17% of workers in the bottom 10% of the earnings range had access to benefits, compared with 84% of workers in the top 10% of the earnings range. The highest paid also were offered more holidays and vacations than lower paid workers (77% vs. 37% and 74% vs. 43%, respectively).
The BLS report is here.