Benefits - Employment Are They Headed Up Or Down?, Details Of The Employment Benefit Package, Are Employer-provided Health Care Benefits Keeping Pace With Health Care Costs?

Employer provided benefits are an important component of total compensation. This chapter looks at trends in both benefits and retirement.

Over the last 20 years employers' costs for employee benefits have remained reasonably constant as a percentage of total compensation. However, the cost of providing health care insurance has risen. The analysis presented will show that health care coverage is one component of the benefit package that has not fared well over this timeframe. The trend is towards employees absorbing at least a portion of the cost of their health care coverage.

The extent to which this is true varies by size of employer. Small employers tend to offer fewer benefits than do large employers. This is true for all benefits within the employee benefit package, not just health care coverage. Many benefit plans require economies of size in order to be cost effective and it is primarily this that keeps small firms from matching the offerings of larger firms. Laws regulating employee-employer relations recognize this difference and they impose regulations more heavily on employers with more than 25 employees. Panels four and five present data on benefits by size of employer.

Employee benefits are a moving target. They change as the demands of the workforce change. The characteristics of the workforce have changed greatly over the past fifty years. So too have employee benefits. As more women have entered the workforce, the number of employees who are also busy raising children has risen. This increased the need for flexible schedules and provisions for family leave. The sixth panel addresses family leave and points out how trends in family-related benefits are changing.

Computers and the Internet have made remote-working arrangements possible and their adoption is often seen as a benefit. Remote-work arrangements are one of the non-traditional benefits that are discussed in panel five.

Early retirement is a trend that is studied in the final five panels. First, trends in retirement age are charted. In the 1950s the average age of retirement was 67 years. By the year 2000 that number is expected to have dropped to just over 61 years. The opposite trend has been seen in life expectancy. In 1950, life expectancy in the U.S. was 68 years. In 2000 that number is 77 years, and in 2050 it is projected to be 81 years. The question posed in the final panels is, can we afford to continue retiring earlier and earlier and living longer and longer?