Employer Costs for Employee Compensation Technical Note

                                          
                                          TECHNICAL NOTE
                                          
Employer Costs for Employee Compensation (ECEC), a product of the National Compensation Survey,
provides the average employer cost for wages and salaries as well as benefits per hour worked. 
The ECEC covers the civilian economy, which includes data from both private industry and state 
and local government. Federal government workers are excluded. Additionally, the self-employed,
private household workers, and the agricultural sector are excluded from the private industry.

Total benefit costs consist of five major categories and include 18 benefit costs:
* Paid leave - vacation, holiday, sick, and personal leave; 
* Supplemental pay - overtime and premium, shift differentials, and nonproduction bonuses; 
* Insurance - life, health, short-term and long-term disability; 
* Retirement and savings - defined benefit and defined contribution; and 
* Legally required benefits - Social Security [refers to Old-Age, Survivors, and Disability
  Insurance (OASDI) program], Medicare, federal and state unemployment insurance, and workers’
  compensation.

All workers are included in the benefit cost estimates including those that do not have plan access
or do not participate. Costs are also affected by other factors such as cost sharing between
employers and employees, plan features, and plan generosity. For the latest information on the
percentage of workers with access to and participating in employer-sponsored benefit plans,
including health care and retirement and savings plans, see www.bls.gov/ebs.

The National Compensation Measures provides additional details on the sample design, calculation
methodology, and resources explaining changes over time, see www.bls.gov/opub/hom/ncs/home.htm.

Sample size
Data for this reference period were collected from a probability sample of approximately 23,100 
occupational observations selected from a sample of about 5,500 private industry establishments
and approximately 7,400 occupational observations selected from a sample of about 1,400 state and
local government establishments that provided data at the initial interview. 

Measures of reliability
Relative standard errors (RSEs) provide users a tool to ascertain the quality of an estimate to
ensure that it is within an acceptable range for their intended purpose. RSEs are available at
www.bls.gov/web/ecec/ecec-rse.htm and the database query tool at www.bls.gov/ecec/data.htm.

Comparisons
Compensation cost levels in state and local government should not be directly compared with levels
in the private industry. Differences between these sectors stem from factors such as variation in 
work activities and occupational structures.

Classification systems
The National Compensation Survey publishes estimates of compensation costs and trends as well as
benefit coverage by ownership, industry group, occupational group, and geographic areas, see
www.bls.gov/eci/factsheets/national-compensation-survey-classification-systems-mapping-files.htm. 
The transition from NAICS 2017 to NAICS 2022 occurred during the March 2024 ECEC and series were 
determined to remain continuous.

Additional information
Additional and historical ECEC estimates are available in the ECEC database query tool at 
www.bls.gov/ecec/data.htm and in xlsx format at www.bls.gov/ecec/tables.htm. The ECEC release
schedule is available at www.bls.gov/schedule/news_release/ecec.htm. Subscribe to receive the BLS
Economic News Release email at public.govdelivery.com/accounts/USDOLBLS/subscriber/new. 

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