Private employers spent 3.5 percent of total compensation to employees for their retirement and savings benefit costs in June, according to the U.S. Bureau of Labor Statistics.
Average costs for retirement and savings benefits were $1.02 per hour worked. For management, professional and related occupations, the average costs were $2.07 per hour, or 4 percent of total compensation. Costs were lowest among service occupations, 22 cents or 1.6 percent of total compensation.
The average costs cited in this report include employer costs for defined benefit and defined contribution plans. The numbers are affected by the percentage of employees who participate in the plans offered.
Recommended For You
The average cost per hour worked for defined benefit plans was 43 cents or 1.5 percent of total compensation. For defined contribution plans, like 401(k)s, that figure was 59 cents per hour worked or 2.1 percent of total compensation.
Employers spent more for union workers' benefits and compensation, $2.89 and 7.4 percent for total compensation. DB plan costs were significantly higher for union workers, $2.11 and 5.4 percent of total compensation, than nonunion workers, 26 cents and 0.9 percent of total compensation. Defined contribution costs for union workers averaged 78 cents compared to nonunion workers' 57 cents.
The number of employees a company has dictates how much it will spend on employee benefits. For those businesses with fewer than 100 workers, the average spent per worker was 62 cents per hour worked or 2.6 percent of total compensation. For those with 100 to 499 employees, the average paid out for retirement and savings benefits was $1.09 per hour worked or 3.7 percent of overall compensation, which was a lot less than the $2.09 per hour worked, or 4.9 percent of compensation, paid to workers at companies with more than 500 employees.
Defined benefit costs ranged from 23 cents per hour worked for companies with 1 to 99 workers to $1 per hour worked for 500 workers or more. For defined contribution plans, the costs ranged from 39 cents per hour worked for 1 to 99 workers to $1.10 per hour worked for 500 workers or more.
Employer retirement and savings benefit costs for full-time workers in private industry averaged $1.30 per hour or 3.9 percent of total compensation, compared to the 23 cents and 1.5 percent of total compensation for part-time workers. For full-time management, professional and other related occupations, the average was $2.26 per hour worked compared with 71 cents for part-time workers.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.