8 Compensation and Working Conditions Fall 2000

JORDAN PFUNTNER

Have Life Insurance Have Life Insurance Have Life Insurance

Benefits Kept Pace Benefits Kept Pace Benefits Kept Pace

with Wages?

Over the last two decades, life insurance protection

for beneficiaries of employees has generally kept up

with employee earnings, either through automatic

adjustments or periodic increases in face value.

Jordan Pfuntner is the Deputy Assistant

Commissioner in the Office of Compensation Levels and Trends, Bureau of Labor Statistics.

Telephone: (202) 691-6309

E-mail: Pfuntner_J@bls.gov

Employer-provided life insurance protects the families ofemployees from the financial

consequences of the death of the employee. Since the founding of the first

group plans in the years immediately

before World War I,1 life insurance has

become one of the standard components of the employee benefits package. By 1994-97, 74 percent of fulltime employees in the private sector

and 87 percent in State and local governments had coverage paid in whole

or in part by their employer. Of these

employees, five-sixths had their coverage paid for entirely by their employer.2 Although prominent, life insurance is typically a relatively inexpensive element of employee compensation: over the last decade, employer

contributions for life insurance have

hovered between 4 and 5 cents per hour

worked by employees, accounting for

0.2 to 0.3 percent of employee compensation costs.3

Despite their comparatively low

share of total compensation costs, life

insurance plans serve an important role

in replacing the income of the families

of deceased employees.4 Given the objective of income replacement, this article looks at one particular aspect of

life insurance plans: Has the face value

of employee coverage kept up with

changes in wages and salaries over

the past two decades? The data to

answer this question come largely from

the Bureau’s Employee Benefits Survey (EBS), which, since 1979, has provided annual measures of the incidence

and characteristics of employee benefit plans in the United States. For life

insurance trends, the article focuses

mainly on information from the surveys

conducted in medium and large (100 or

more employees) private establishments, because these surveys date

back to 1979. Survey data on small private establishments (fewer than 100

employees) and State and local governments are available for only the last

decade.5

How life insurance benefits are

calculated

This article focuses on the face amount

of life insurance policies, that is, the

amount of money payable to the beneficiaries designated by the employee.

There are two primary methods for

calculating the face amount of life insurance. First, amounts may be directly tied to the employee’s salary by

multiplying the salary by a designated
 Compensation and Working Conditions Fall 2000 9

Have Life Insurance Benefits Kept Pace with Have Life Insurance Benefits Kept Pace with 

Wages?

factor (such as 1 times earnings, or 2

times earnings). These are known as

multiple-of-earnings plans. Second,

a “flat” amount, such as $20,000, may

be paid to all employees regardless of

salary.6

In medium and large private establishments, the most common method

of calculating life insurance benefits

has been to base the face amount on

earnings. From 1979 through 1997,

about 3 in 5 life insurance participants

in such establishments were covered

by plans based upon earnings, with

nearly all of the remainder in plans

specifying a flat dollar amount. (See

table 1.7) The opposite situation prevailed in small private establishments

and State and local governments, in

which about 3 in 5 participants had a

flat amount of insurance and 2 in 5 had

an amount tied to their salary. (See

tables 2 and 3.) (Readers should note

that small year-to-year changes in these

figures are generally not statistically

significant.8 ) Over the entire survey

period, the relative incidence of these

two major ways of calculating life insurance changed little. The only noteworthy change was the replacement of

graduated schedules of earnings with

multiple-of-earnings formulas in medium and large private establishments. 9

Within the private sector, there were

sharp differences among the occupations studied in how life insurance protection was determined. In medium and

large private establishments in 1997,

7 in 10 white-collar participants had

coverage linked to earnings, while 2 in

10 had flat dollar coverage. For bluecollar and service workers, the pattern

was reversed: 52 percent had flatamount coverage and 39 percent had

coverage based on earnings. Similarly,

in small private establishments in 1996,

white-collar participants were more

likely to be in earnings-based plans (43

percent) than were blue-collar and service workers (23 percent). Such pronounced occupational differences were

not observed, however, among State

and local governments. 10

How life insurance benefits relate

to earnings

When amounts are based directly upon

earnings, plans automatically adjust to

salary increases (or decreases). Flatamount plans, in contrast, do not automatically follow changes in salaries, but

instead must be adjusted through administrative action.

Plans based on earnings. Over the last

two decades, the primary method for

tying life insurance amounts to earnings has been to provide coverage for

1 times earnings. In 1997, a majority of

life insurance participants with earnings-based coverage in medium and

large establishments had face amounts

equal to their earnings, often rounded

up to the next highest $1,000 or determined using a similar rounding technique. Throughout this period, the

second most common multiplier was 2

times earnings. From 1979 to 1997,

there was a small increase in the proportion of workers in plans with 1-timesearnings multipliers, accompanied by

a corresponding decrease in the incidence of 2-times-earnings plans. (See

table 4.) In 1991 and 1997, however,

the overall average multiple remained

NOTE: Because of rounding, sums of

individual items may not equal totals. Figures for 1991 were adjusted to reflect proportions of full-time workers with life insurance coverage.

1

Less than 0.5 percent.

NOTE: Because of rounding, sums of

individual items may not equal totals. Figures for 1990 and 1992 were adjusted to

reflect proportions of full-time workers with

life insurance coverage.

Benefit formula 1979 1985 1991 1997

Total with life insurance ................................... 100 100 100 100

Based on earnings ...................................... 63 66 61 63

Multiple of earnings ................................. 39 53 54 57

Graduated schedule of earnings ............ 24 13 7 5

Flat dollar amount ........................................ 34 31 37 36

Other ........................................................... 3 3 1 2

TABLE 1. Method of determining basic life insurance coverage, percent of full-time

participants, medium and large private establishments, selected years, 1979-97

1

Less than 0.5 percent.

NOTE: Because of rounding, sums of

individual items may not equal totals. Figures for 1990 and 1992 were adjusted to

reflect proportions of full-time workers with

life insurance coverage.

Benefit formula 1987 1990 1992 1994 1998

Total with life insurance ................... 100 100 100 100 100

Based on earnings ...................... 45 39 40 40 40

Multiple of earnings ................. 42 37 38 37 36

Graduated schedule of

 earnings ................................ 3 3224

Flat dollar amount ........................ 53 61 59 58 55

Other ........................................... 1 (1)125

TABLE 3. Method of determining basic life insurance coverage, percent of full-time

participants, State and local governments, selected years, 1987-98

Benefit formula 1990 1992 1994 1996

Total with life insurance ................................... 100 100 100 100

Based on earnings ...................................... 37 37 32 34

Multiple of earnings ................................. 34 34 31 34

Graduated schedule of earnings ............ 3 3 (1) (1)

Flat dollar amount ........................................ 63 62 67 62

Other ........................................................... (1)1 1 3

TABLE 2. Method of determining basic life insurance coverage, percent of full-time

participants, small private establishments, selected years, 1990-96
10 Compensation and Working Conditions Fall 2000

at 1.5 times earnings.11 This suggests

that, for workers covered by multipleof-earnings plans, coverage has largely

kept pace with changes in earnings.

Very similar patterns prevailed in

small private establishments in the decade of the 1990s. (See table 5.) The

average multiple of earnings declined

slightly, from 1.6 in 1990 to 1.4 in 1996.

Coverage patterns were essentially unchanged in State and local governments from 1987 to 1998. (See table 6.)

Despite year-to-year fluctuations, the

overall average salary multiple for government employees remained relatively

steady at 1.5 in 1987 and 1.6 in 1998.

This suggests that face amounts kept

pace with earnings for government

workers.

One factor to consider in examining

earnings-based plans is the existence

of maximum limits, or ceilings, on coverage. Such limits are common, particularly in the private sector. In the

most recent surveys, such ceilings applied to about 6 in 10 workers with life

insurance tied to earnings in the private sector, but to only 3 in 10 such

government workers. Maximum limits

changed little overall for private sector

workers in the years covered by the

Employee Benefits Survey. Among

medium and large firms, the proportion

of participants in multiple-of-earnings

plans subject to ceilings rose from 52

percent in 1985 to 60 percent in 1997,

but these ceilings became less common

in smaller establishments, with their

incidence among participants declining

from 65 percent in 1990 to 59 percent in

1996. Similarly, the incidence of such

ceilings declined slightly in State and

local governments, with 37 percent of

participants subject to ceilings in 1987

and 31 percent in 1994.12

Of course, for those workers in plans

that did not specify a ceiling, coverage

is not limited. But even for workers

with such limits, average ceilings in recent years have been quite high relative to wage rates. (See table 7.13 ) Ceilings averaged about $250,000 in State

and local governments in 1994 and in

small private establishments in 1996.

Such ceilings averaged over $400,000

in medium and large private establishments in 1997, up from $318,000 in 1995

and $263,000 in 1993.14 On the other

hand, the proportion of workers in medium and large firms with ceilings below $100,000 increased from 10 percent

in 1985 to 18 percent in 1997, while the

proportion with ceilings of $100,000 or

more held steady at just over 40 percent.15

It is difficult to gauge the role that

ceilings have played in limiting face

coverage by looking only at these summary tabulations. In the early 1990s,

however, the Employee Benefit Survey

tables compared maximum ceilings in

each plan with the amount of the earnings multiples. These data are summarized in table 8. In the 1991-92 studies

of private firms, employees with multiples of twice earnings or more tended

TABLE 6. Multiple-of-earnings life insurance benefit formulas, percent of full-time

participants with multiple-of-earnings life insurance benefits, State and local

governments, selected years, 1987-98

Multiple-of-earnings benefit formulas 1987 1990 1992 1994 1998

Total with multiple of earnings .................... 100 100 100 100 100

Less than 1.0 ......................................... 4 1 1 1 1

1.0 ........................................................... 44 45 40 37 42

1.1-1.9 .................................................... 15 16 15 16 15

2.0 ........................................................... 29 19 21 15 20

Greater than 2.0 ..................................... 7 19 22 23 11

Other formulas ....................................... — 1 (1) 6 12

Average multiple ......................................... 1.5 1.7 1.8 1.9 1.6

1

Less than 0.5 percent.

NOTE: Because of rounding, sums of

individual items may not equal totals. Dash

indicates no employees in this category.

The average multiple for 1987 was calculated from published data.

TABLE 5. Multiple-of-earnings life insurance benefit formulas, percent of full-time

participants with multiple-of-earnings life insurance benefits, small private

establishments, selected years, 1990-96

Multiple-of-earnings benefit formulas 1990 1992 1994 1996

Total with multiple of earnings ................................... 100 100 100 100

Less than 1.0 ........................................................ 2 1 3 3

1.0 .......................................................................... 48 47 49 53

1.1-1.9 ................................................................... 8 11 11 16

2.0 .......................................................................... 30 31 27 21

Greater than 2.0 .................................................... 11 9 9 6

Other formulas ...................................................... 1 1 1 1

Average multiple ........................................................ 1.6 1.5 1.5 1.4

TABLE 4. Multiple-of-earnings life insurance benefit formulas, percent of full-time

participants with multiple-of-earnings life insurance benefits, medium and large

private establishments, selected years, 1979-97

Multiple-of-earnings benefit formulas 1979 1985 1991 1997

Total with multiple of earnings ................................... 100 100 100 100

Less than 1.0 ........................................................ 3 2 3 5

1.0 .......................................................................... 44 45 52 53

1.1-1.9 ................................................................... 11 10 12 11

2.0 .......................................................................... 34 33 25 22

Greater than 2.0 .................................................... 8 7 9 8

Other formulas ...................................................... — 3 (1) 1

Average multiple ........................................................ 1.5 1.5

1

Less than 0.5 percent.

NOTE: Because of rounding, sums of

individual items may not equal totals. Dash

indicates no employees in this category.

Average multiples were not calculated for

1979 and 1985.
 Compensation and Working Conditions Fall 2000 11

Have Life Insurance Benefits Kept Pace with Have Life Insurance Benefits Kept Pace with 

Wages?

to have higher ceilings than did employees with multiples less than twice

earnings. 16 A similar, though less pronounced, pattern emerged from the

1992 study of State and local governments.17 Thus, although ceilings do

limit benefits, coverage limits tend to

be higher in plans with more generous

benefits.

Plans based on flat amounts. The second most common method of calculating life insurance coverage is to provide

the same face amount to all participants regardless of salary. Because

these plans are not linked to salary, they

do not automatically adjust to changes

in workers’ earnings. Employers do,

however, revise flat-amount coverage

periodically, either through their own

administrative decisions or as a result

of collective bargaining. Once again,

the Employee Benefits Survey (EBS)

provides data that are helpful in answering the question: Have flat-amount life

insurance plans kept up with changes

in earnings?

How have earnings changed during

the last two decades? The Employment

Cost Index (ECI), a component of the

National Compensation Survey, measures the quarterly change in employer

costs for wages and employee benefits.18 Since 1990, the ECI and the EBS

have used the same establishment and

worker sample and have adopted the

same data collection concepts, definitions, and procedures. The ECI is therefore a good yardstick for measuring

wages in light of changes in life insurance plans. During the years for which

EBS data can be used to track developments in life insurance plans in medium

and large establishments (1979-97), private industry wages and salaries rose

123 percent.19 Wages increased 109

percent for blue-collar workers and 110

percent for service workers, the two

occupational groups for which flatamount life insurance plans are predominant. During the shorter time span

covered by the EBS small establishments survey, 1990-96, wages rose 19

percent for blue-collar workers and 18

percent for service workers. State and

local government workers as a whole

saw their wages increase by 48 percent

over the 1987-98 period covered by EBS

surveys. (As noted earlier, there were

not marked differences in methods of

determining life insurance among occupational groups in governments.)

The EBS data show that flat-amount

coverage has increased over the years

in both the private and State and local

government sectors. Key findings are

summarized in chart 1. For medium and

large firms, table 9 highlights key data

on flat-amount plans from 1979 to 1997

in four evenly spaced intervals. There

is clearly a movement towards providing more generous benefits over the

years. This trend is reflected in the

average amounts of flat-amount insurance provided to blue-collar and service workers, which rose from $10,000

in 1985 to $15,100 in 1997, a 51-percent

increase.20 During the same 12-year

period, private sector wages rose by

43 percent for blue-collar workers and

44 percent for service workers.

This trend of increasing benefits in

line with wage increases also was evident in small private establishments. As

table 10 shows, there was a decline in

the proportion of workers in plans with

benefits of less than $10,000, and an

increase in the proportion in plans with

benefits of $20,000 and over from 1990

to 1996. Average benefits rose 20 percent over the period—in tandem with

the rise in wages for blue-collar and service workers.

State and local government workers experienced increases in their flatamount coverage similar to those of

their counterparts in private firms. (See

table 11.) There was a decrease in the

proportion of workers with coverage

of less than $10,000, and an increase in

the proportion of those with coverage

of $20,000 and greater. This is borne

out by the averages calculated for each

year, which rose 69 percent from 1987

TABLE 7. Maximum benefit provisions, percent of full-time participants with

multiple-of-earnings life insurance formulas, selected years, 1994-97

Total with multiple-of-earnings formula ........... 100 100 100

 No maximum benefit amount ...................... 36 28 65

 With maximum benefit amount.................... 60 59 31

 Less than $50,000 ................................... 2 1 1

 $50,000-$99,999 ...................................... 16 20 13

 $100,000 ................................................... 6 11 1

 Over $100,000 and less than $500,000 . 22 18 9

 $500,000 and over ................................... 14 8 6

 Not determinable ......................................... 3 13 3

Average maximum benefit .............................. $441,000 $238,000 $256,000

Medium and

large

establishments,

1997

State and

local

governments, 1994

Small

establishments, 1996

Maximum provision

NOTE: Because of rounding, sums of

individual items may not equal totals. These

data were not published in the 1998 government survey.

TABLE 8. Relationship of life insurance coverage ceilings and earnings multipliers,

percent of participants,1991-92

Less than 2.0 ............. 22 15 26 8 18 2

2.0 or more ................ 6 11 11 20 11 5

Multiple-of-earnings

benefits formula

Medium and large

private establishments, 1991

Small private

establishments,

1992

State and local

governments,

1992

Coverage ceiling

Multiplier Less

than

$250,000

$250,000

or

more

$250,000

or

more

$250,000

or

more

Less

than

$250,000

Less

than

$250,000
12 Compensation and Working Conditions Fall 2000

TABLE 9. Life insurance benefits, percent of blue-collar and service participants with flatamount coverage, medium and large private establishments, selected years, 1979-97

Flat amount 1979 1985 1991 1997

Total with flat amount ........................................... 100 100 100 100

Less than $5,000 ............................................ 29 14 5 3

$5,000-$9,999 ................................................. 34 35 33 18

$10,000-$19,999 ............................................. 36 43 42 41

$20,000 and over ............................................ 1 9 20 22

Other formulas ................................................ — — — 15

Average amount .................................................. $10,000 $13,000 $15,100

NOTE: Because of rounding, sums of individual items may not equal totals. Dash indicates no

employees in this category. Average flat amounts were not published for 1979.

TABLE 11. Life insurance benefits, percent of all participants with flat-amount coverage, State

and local governments, selected years, 1987-98

Flat amount 1987 1990 1992 1994 1998

Total with flat amount ....................... 100 100 100 100 100

Less than $5,000 ........................ 18 10 13 7 9

$5,000-$9,999 ............................. 29 24 21 20 15

$10,000-$19,999 ......................... 33 42 34 34 33

$20,000 and over ........................ 21 25 33 35 39

Other formulas ............................ — — — 4 3

Average amount .............................. $11,200 $13,700 $15,800 $17,500 $18,900

NOTE: Because of rounding, sums of individual items may not equal totals. Dash indicates no

employees in this category. The average flat amounts for 1987 and 1990 were calculated from published

data.

TABLE 10. Life insurance benefits, percent of blue-collar and service participants with flatamount coverage, small private establishments, selected years 1990-96

Flat amount 1990 1992 1994 1996

Total with flat amount ........................................... 100 100 100 100

Less than $5,000 ............................................ 6664

$5,000-$9,999 ................................................. 17 16 10 13

$10,000-$19,999 ............................................. 66 57 60 59

$20,000 and over ............................................ 12 21 22 21

Other formulas ................................................ — — 2 3

Average amount .................................................. $11,700 $12,900 $13,700 $14,000

NOTE: Because of rounding, sums of individual items may not equal totals. Dash indicates no

employees in this category.
 Compensation and Working Conditions Fall 2000 13

Have Life Insurance Benefits Kept Pace with Have Life Insurance Benefits Kept Pace with 

Wages?

to 1998. In contrast, government workers’ wages increased only 48 percent

over these 11 years.

Conclusion and a look to the

future

Overall, then, the face value of life insurance plans generally kept pace with

changes in wages, thus preserving the

protection of income over time. For

nearly half the workers, this change

was automatic, because their coverage

was tied directly to their wages. But

even for workers participating in flatamount insurance plans, face values

generally increased along with wages

over the years.

The ability to track trends in benefit

plans will improve over the next few

years as a result of BLS efforts to meld

its compensation surveys into a single,

unified program. This life insurance

study has been hampered by the lack

of data for all sectors of the economy

in any given year, and the inability to

examine the relationship among components of the compensation package.

For example, it would be interesting to

compare flat-amount life insurance benefits to the actual wage rates of the

employees participating in flat-amount

plans. How did wage rates change over

time for workers with flat-amount benefits compared to workers with multipleof-earnings benefits? Data limitations

prevent us from answering these questions currently.

The new unified compensation survey program, called the National Compensation Survey, will enjoy several

advantages over the old Employee

Benefits Survey. First, all sectors of

the economy will be surveyed annually, making it easier to track trends.

Second, data on wage rates, benefit

plan participation, and benefit plan provisions will be linked on a unified database. Although wage rates and benefit plan coverage will not be linked for

individual workers, they will be linked

occupation by occupation within establishments. Beginning later this year,

results from this improved program of

compensation statistics will become

available in stages over the next 3

years.21

CHART 1. Wage changes and changes in flat-amount life insurance coverage

0

10

20

30

40

50

60

70

80

Blue Collar and Service

Workers, Medium and

Large Establishments,

1985-1997

Blue Collar and Service

Workers, Small

Establishments, 1990-

1996

State and Local

Government Workers,

1987-1998

Wages

Flat Amount Coverage

Percent increase

Wages

Flat-amount coverage

Blue-collar and service

workers, medium and

large establishments,

1985-97

Blue-collar and service

workers, small establishments, 1990-96

State and local

government workers,

1987-98
14 Compensation and Working Conditions Fall 2000

1

 For the history of employer-sponsored life

insurance in the United States, see Michael Bucci,

“Growth of employer-sponsored group life insurance,” Monthly Labor Review, October 1991, reprinted in Employee Benefits Survey: A BLS

Reader, Bulletin 2459 (Bureau of Labor Statistics, February 1995), pp. 230-37. 2

 Data are from Compensation and Working

Conditions, Winter 1999, pp. 54-55, tables

B-1 and B-3. 3

 See Employer Costs for Employee Compensation, 1986-99, Bulletin 2526 (Bureau of Labor Statistics, March 2000). 4 For a discussion of life insurance plan design, see William H. Rabel and Jerry S.

Rosenbloom, “Group Life Insurance: Term and

Permanent,” in The Handbook of Employee Benefits: Design, Funding, and Administration,

4th ed. (New York, McGraw-Hill, 1996), pp.

329-53. 5 Data for medium and large private establishments are available for the years 1979-86, 1988-

89, 1991, 1993, 1995, and 1997. Data for small

private establishments are available for the years

1990, 1992, 1994, and 1996, but not for 1998.

Data for State and local governments are available for the years 1987, 1990, 1992, and 1994,

but not for 1996; a 1998 government survey will

be published later this year. 6

 Other methods, such as providing graduated

schedules of coverage based upon years of service

or salary ranges, have covered a very small proportion of employees in recent years and will not

be discussed in this article. 7

 Unless indicated otherwise, all figures relate

to full-time employees. In some cases, published

data have been reclassified to ensure consistent

classification of plan provisions across years. 8

 Readers should also be aware that survey

establishment coverage has expanded over the

years, which could affect trends in the data. The

1987 government survey did not include establishments with fewer than 50 workers. While it is

unlikely that the inclusion of smaller government

establishments in the 1990, 1992, 1994, and 1998

surveys would materially impact the trends cited

in this article, the effect of this change in scope is

unknown. Similarly, in 1988, the medium and

large private establishments survey expanded to

include establishments with 100 or more employees in all private industries. (Previous surveys had

limited coverage of services industries, and included only establishments with 250 or more employees in selected other industries.) This

survey expansion appeared to have little effect on the proportions of workers with the

various types of life insurance formulas. (See

Employee Benefits in Medium and Large Private Firms, 1988, Bulletin 2336 (Bureau of

Labor Statistics, August 1989), tables 62 and

188.) However, the impact of this expansion on the other details of life insurance

plans discussed in this article is unknown. For

more information on survey scope changes,

see Allan P. Blostin, “An Overview of the

EBS and the NCS,” Compensation and Working Conditions, Spring 1999, pp. 2-5. 9

 Graduated schedules based upon earnings

provide designated levels of coverage at specified

earnings intervals, rather than coverage calculated

as a direct multiple of earnings. For example, an

earnings schedule might call for $15,000 of coverage for workers with earnings of less than

$20,000; $16,000 for workers with earnings

of $20,000 to $24,999; $17,000 for workers with earnings of $25,000 to $29,999;

and so on, with the schedule topping out at

$22,000 of coverage for workers with earnings of $50,000 or more. 10 See Employee Benefits in Medium and

Large Private Establishments, 1997, Bulletin

2517 (Bureau of Labor Statistics, September

1999), p. 95; Employee Benefits in Small Private Establishments, 1996, Bulletin 2507 (Bureau of Labor Statistics, April 1999), p. 61; and

Employee Benefits in State and Local Governments, 1994, Bulletin 2477 (Bureau of Labor Statistics, May 1996), p. 100. 11 The average multiple was 1.5 in 1988 and

1989, and 1.4 in 1993 and 1995. See Employee

Benefits in Medium and Large Private Firms,

1988, p. 43; Employee Benefits in Medium and

Large Firms, 1989, Bulletin 2363 (Bureau of

Labor Statistics, June 1990), p. 46; Employee

Benefits in Medium and Large Private Establishments, 1993, Bulletin 2456 (Bureau of Labor Statistics, December 1994), p. 104; and Employee

Benefits in Medium and Large Private Establishments, 1995, Bulletin 2496 (Bureau of Labor Statistics, April 1998), p. 96. 12 See Employee Benefits in Medium and

Large Firms, 1985, Bulletin 2262 (Bureau of

Labor Statistics, July 1986), pp. 46-47; Employee

Benefits in Medium and Large Private Establishments, 1997, p. 97; Employee Benefits in Small

Private Establishments, 1990, Bulletin 2388 (Bureau of Labor Statistics, September 1991),

pp. 65-66; Employee Benefits in Small Private Establishments, 1996, p. 64; Employee

Benefits in State and Local Governments,

1987, Bulletin 2309 (Bureau of Labor Statistics, May 1988), p. 51; and Employee Benefits in State and Local Governments, 1994,

p. 103. Data on maximum benefits will not be

published for the 1998 government survey. 13 In 1997, full-time workers averaged

$15.77 per hour, or about $32,500 per year,

assuming a 52-week work schedule. (National

Compensation Survey: Occupational Wages

in the United States, 1997, Bulletin 2519

(Bureau of Labor Statistics, September 1999),

p. 7.) 14 Information on average ceilings was not

calculated prior to 1993. 15 See Employee Benefits in Medium and

Large Firms, 1985, pp. 46-47, for 1985 data. 16 See Employee Benefits in Medium and

Large Private Establishments, 1991, Bulletin

2422 (Bureau of Labor Statistics, May 1993), pp.

74-75; and Employee Benefits in Small Private

Establishments, 1992, Bulletin 2441 (Bureau of

Labor Statistics, May 1994), pp. 68-69. 17 See Employee Benefits in State and Local

Governments, 1992, Bulletin 2444 (Bureau of

Labor Statistics, July 1994), pp. 69-70. 18 For more information on the Employment

Cost Index, see Employment Cost Indexes,

1975-98, Bulletin 2514 (Bureau of Labor

Statistics, August 1999). 19 ECI data are not available by size of

establishment. All ECI data are cited as of

the quarter ending in March of each year. 20 Average flat amounts were calculated from

survey microdata only for 1985 and later years.

The average can be estimated from the published

distribution, using a procedure that yields results

that are, on average, within 2 percent of the calculated averages for 1985-86, 1988-89, 1991, 1993,

1995, and 1997. Using this procedure, we estimate the average for 1979 to be about $8,200.

If this estimate is accurate, the average flat

amount for blue-collar and service workers

increased by 84 percent from 1979 to 1997,

slightly slower than the 109- to 110-percent

growth in wages during the same period. 21 For more information about NCS plans,

see Harriet G. Weinstein, “Overview of the

NCS: Summer 1998,” Compensation and Working Conditions, Summer 1998, pp. 41-44.