By design, and perhaps more often by accident, the federal government has also stimulated the creation and expansion of benefits programs. Benefits plans are an increasingly important part of corporate life. According to the U.S. Bureau of Labor Statistics, total benefit costs represent thirty-nine percent of wages and salaries. Thus, for every one dollar that the federal government requires corporations to allocate for employee benefits, corporations provide another two dollars voluntarily. In many respects, benefits programs are the most important compensation that any employee will receive.
Employee benefits are by no means fringe items or an inconsequential form of compensation.
Without getting too encyclopedic, I would like to review how employee benefits have evolved over the past one hundred years. At the beginning of this century, employee benefits programs were practically nonexistent. The agrarian economy did not encourage the creation of such plans. At that time, there was also fierce opposition to direct governmental involvement in employee benefits. People recalled the patronage and corruption associated with the administration of Civil War pensions.