EBRI Issue Brief

The Changing World of Work and Employee Benefits

Apr 1, 1996 20  pages


  • The change in employers' philosophy from paternalism to individual choice and responsibility has been accompanied by a closer look by both employers and workers at work force patterns. In some areas, such as the age of the population, the numbers are changing dramatically. In others, such as job tenure and the incidence of career employment, they have actually changed little. This Issue Brief adds perspective to statistics on demographics relating to the changing labor force, the ways in which work is changing to accommodate the numbers, and prospects for employee benefits in dealing with the changes.
  • The median age of the population will increase by 14.9 percent, or 5.1 years, by the time the last of the World War II baby boomers move past their early 60s in 2040, under the Census Bureau's middle series assumptions.
  • Average household size was 3.37 persons in 1950, 2.69 persons in 1985, and 2.67 persons in 1994. In 1960, 85 percent of all households were family households, declining to 72 percent in 1985 and 71 percent in 1993. Only 30.5 percent of married women participated in the labor force in 1960, increasing to 54.2 percent in 1985 and 59.4 percent in 1993. These patterns affect consumption and saving patterns and issues related to the building of retirement assets. They also affect relative demand for health benefits and for benefit flexibility.
  • The educational attainment of the labor force is growing. In 1970, persons with less than a high school diploma represented 36.1 percent of the labor force, compared with 12.8 percent in 1991. In 1970, persons with some college education represented 11.8 percent of the labor force, compared with 21.3 percent in 1991; persons with four years or more of college made up 14.1 percent of the labor force in 1970, compared with 26.7 percent in 1991.
  • Between 1987 and 1992, firms with fewer than 100 employees created 16.9 million new jobs, compared with firms with more than 1,000 employees, which created 5.1 million jobs. Since these small firms are less likely to have employee benefit programs, there are implications for future economic security and retirement patterns.
  • In 1993, 19 percent of workers had been in the same job for less than one year, 3 percent had been at their current job between 1 and 4 years, 20 percent had been at the current job between 5 and 9 years, 17 percent had been at their current job 15 or more years, and 2 percent did not know how long they had been at their current job. This represented very little change from data collected in 1983.
  • A problem with the reporting of wage and salary earnings is that the index does not capture the value of employee benefits, which are a rapidly growing segment of total compensation. In 1960, noncash benefits accounted for 8.0 percent of total compensation, increasing to 17.8 percent by 1993.