Midwest Employers Pay Lower Cost Per Employee

Employers in Midwestern states like Missouri and Illinois paid lower hourly costs for employee compensation than the national average.

According to the U.S. Bureau of Labor Statistics, employers in the West North Central region paid an average of $22.45 an hour for employee compensation in June 2005. This includes $16.23 for wages and salaries, or 72.3 percent, plus $6.22 for total benefits, or 27.7 percent. Legally required benefits like Social Security and Medicare, unemployment insurance and workers’ compensation insurance took up the largest piece of the total cost at 8.5 percent. Other forms of insurance, such as health and life, took up 7.2 percent, while paid leave takes up 5.7 percent.

The region includes Missouri, Iowa, Kansas, Minnesota, Nebraska, North Dakota and South Dakota.

In the East North Central region–Illinois, Indiana, Michigan, Ohio and Wisconsin–employers paid $24.96 an hour for employee compensation. Wages and salaries took up $17.27, or 69.2 percent, while total benefits took up $7.69, or 30.8 percent. Legally required benefits were 8.6 percent of costs, while life and health insurance took up 8.1 percent, and paid time off 6.4 percent. For the Midwest as a whole, costs were $24.18, including $16.95 for wages and salaries and $7.23 for benefits.

Nationally, employer costs for employee compensation averaged $25.86 per hour worked. Wages and salaries, which averaged $18.21, accounted for 70.4 percent of these costs, while benefits, which averaged $7.64, accounted for the remaining 29.6 percent.