Benefit Incidence Among Medium to Large Employers

The National Compensation Survey (NCS) of the U.S. Bureau of Labor Statistics tracks and publishes data on benefit incidence (expressed in terms of percentages of workers with access to or participation in employer-provided benefit plans). According to the last published NCS Survey (2001, based on 1999 data), the most prevalent employee benefit available to workers in the private sector was paid time off (with paid vacation and paid holidays being the most recurrent benefits).

Paid sick leave and term life insurance was an employee benefit enjoyed by more than half of all private-sector workers (in the 70s percentile for both). Fifty-three percent of employees participated in health care plan benefit programs, and 48 percent were covered by retirement or pension plans (most of which were contribution plans). Short- and long-term disability benefits were available to 36 and 25 percent of employees, respectively. The other frequently offered benefits were non-production bonuses (available to 42 percent of employees) and job-related education assistance (available to 41 percent of employees).

Benefit coverage in general was much more prevalent (predictably) among full-time employees: 64 percent of full-time, versus 14 percent of part-time employees, were covered by health care plans (overall, 53 percent of all employees were covered). Likewise 56 percent of full-time (versus 21 percent of part-time) employees were covered by retirement benefits plans (with 48 percent of all employees enrolled).

The greatest disparity in benefit incidence was in relation to the size of the company or establishment. For example, 81 percent of workers in companies with more than 2,500 employees had a retirement plan, compared with just 30 percent of workers with small establishments of 50 employees or less. Paid holidays were offered to 82 percent of employees in large establishments, compared to 66 percent in the smallest establishments.

Blue-collar and service workers were more likely to have their health care benefits fully paid for by their employers than their counterparts in professional or technical jobs. Goods-producing industries had a higher incidence of benefits coverage than did service-producing industries. Finally, geographic location affected benefits coverage, although less dramatically: 53 percent of workers in the Northeast and Midwest—ccompared with 47 percent in the West, and 43 percent in the South—were covered by retirement benefits. Overall incidence of benefits, expressed by specific benefit, was as follows. (All fifty states were included in the NCS survey.)

  • Retirement benefits: Forty-eight percent of all workers were participating in retirement plans. This number included 79 percent of union employees and 44 percent of nonunion employees. Employee contribution plans outweighed defined benefits by approximately 15 percent.
  • Health care benefits: Fifty-three percent of all workers were covered by health insurance plans. This number included 73 percent of all union members and 51 percent of non-union members.
  • Dental care benefits: Fifty-two percent of all workers enjoyed dental care insurance benefits, and 52 percent of union workers had dental coverage.
  • Life insurance: Fifty-six percent of all workers had term life insurance as an employee benefit. This number included 78 percent of union members and 76 percent of those in professional or technical fields. The retail trade had the lowest incidence of life insurance benefits.
  • Paid sick leave: Only 53 percent of all workers had paid sick leave, parallel with a 54 percent union member benefit incidence. Incidence (occurrence of available benefits, not occurrence of use of the paid sick leave) was highest among professional and technical employees (81 percent).
  • Short-term disability insurance: Thirty-six percent of all workers were covered under short-term disability plans, with highest incidence among union employees (66 percent).
  • Paid vacation: Just under 80 percent of all employees enjoyed paid vacations, higher among union members (86 percent) and professional/technical employees (88 percent) (75 percent for blue-collar or service employees). Forty-three percent of part-time employees were eligible for vacation benefits.
  • Paid holidays: Seventy-five percent of all employees were paid for holidays. This number included 82 percent of union employees and75 percent of non-union employees, but 36 percent of part-time employees. The retail industry faired poorly, with only 50 percent of employees being paid for holidays; manufacturing and utilities companies offered paid holidays to approximately 92 percent of their workers.
  • On-site child care: Only three percent of all workers participated in this benefit, with highest incidence (ten percent) in companies employing 2,500 or more. Prevalence of this benefit was slightly higher in the Northeast and lowest in the West.
  • Severance pay: Twenty-two percent of all workers were protected with severance pay benefits, slightly higher (28 percent) among union members. The benefit most often occurred in companies employing 2,500 or more (53 percent), and the benefit appeared most frequently in the finance, insurance, and real estate industries (44 percent).
  • Educational assistance: Work-related education assistance appeared as an available benefit most often in companies employing2,500 or more (70 percent) and in the finance, insurance, and real estate industries(69 percent). Overall benefit incidence was41 percent. Ten percent of employees received an education benefit that was not work-related.
  • Savings and thrift plans: Of those establishments with 100 or more workers, 87 percent of participating employees may choose how their funds are invested and 65 percent may choose how the employer’s matching funds are invested. The most recurring investment choices were company stock funds, common stock funds, bond funds, government securities, and guaranteed investment contracts.

Inside Benefit Incidence Among Medium to Large Employers