Editor's Note: This story originally appeared on Construction Coverage.
In today’s complex labor market, U.S. businesses are grappling with a dual challenge: persistent worker shortages and rising costs that are squeezing profit margins across many industries.
At the same time, a growing number of firms are reversing years of offshoring by bringing jobs back to the U.S. — a shift driven by the need for supply chain resiliency and geopolitical stability.
But domestic labor, while potentially more stable, comes at a premium price, prompting employers to take a closer look at the full cost of maintaining a domestic workforce.
Against this backdrop, researchers at Construction Coverage examined new data from the U.S. Bureau of Labor Statistics (BLS) to identify the true cost of employing workers in the private sector.
This analysis goes beyond base wages to include a common suite of benefits — ranging from health insurance and retirement plans to legally mandated contributions like Social Security and workers’ compensation insurance.
Following is a breakdown of the total cost of employing workers in America’s major metropolitan areas.
15. Miami-Fort Lauderdale-Port St. Lucie, FL
- Total compensation: $36.37
- Wages and salaries: $26.50
- Total benefits: $9.87
- Labor burden rate: 37.2%
14. Phoenix-Mesa-Scottsdale, AZ
- Total compensation: $41.64
- Wages and salaries: $30.04
- Total benefits: $11.60
- Labor burden rate: 38.6%
13. Dallas-Fort Worth, TX-OK
- Total compensation: $42.42
- Wages and salaries: $29.94
- Total benefits: $12.48
- Labor burden rate: 41.7%
12. Atlanta-Athens-Clarke County-Sandy Springs, GA
- Total compensation: $43.92
- Wages and salaries: $31.05
- Total benefits: $12.87
- Labor burden rate: 41.4%
11. Houston-The Woodlands, TX
- Total compensation: $45.87
- Wages and salaries: $31.60
- Total benefits: $14.28
- Labor burden rate: 45.2%
10. Minneapolis-St. Paul, MN-WI
- Total compensation: $46.50
- Wages and salaries: $32.87
- Total benefits: $13.63
- Labor burden rate: 41.5%
9. Chicago-Naperville, IL-IN-WI
- Total compensation: $48.00
- Wages and salaries: $33.12
- Total benefits: $14.88
- Labor burden rate: 44.9%
8. Los Angeles-Long Beach, CA
- Total compensation: $48.20
- Wages and salaries: $33.11
- Total benefits: $15.09
- Labor burden rate: 45.6%
7. Detroit-Warren-Ann Arbor, MI
- Total compensation: $54.83
- Wages and salaries: $36.24
- Total benefits: $18.59
- Labor burden rate: 51.3%
6. Boston-Worcester-Providence, MA-RI-NH-CT
- Total compensation: $55.96
- Wages and salaries: $37.76
- Total benefits: $18.20
- Labor burden rate: 48.2%
5. New York-Newark, NY-NJ-CT-PA
- Total compensation: $57.09
- Wages and salaries: $39.36
- Total benefits: $17.74
- Labor burden rate: 45.1%
4. Philadelphia-Reading-Camden, PA-NJ-DE-MD
- Total compensation: $58.74
- Wages and salaries: $39.82
- Total benefits: $18.92
- Labor burden rate: 47.5%
3. Washington-Baltimore-Arlington, DC-MD-VA-WV-PA
- Total compensation: $60.31
- Wages and salaries: $42.81
- Total benefits: $17.50
- Labor burden rate: 40.9%
2. Seattle-Tacoma, WA
- Total compensation: $65.88
- Wages and salaries: $45.00
- Total benefits: $20.88
- Labor burden rate: 46.4%
1. San Jose-San Francisco-Oakland, CA
- Total compensation: $71.63
- Wages and salaries: $49.43
- Total benefits: $22.20
- Labor burden rate: 44.9%
Methodology
The data used in this analysis is from the U.S. Bureau of Labor Statistics’ Employer Costs for Employee Compensation (ECEC) program, which measures the average cost to employers for direct wages and a range of benefits.
Benefits captured in the ECEC data encompass several categories: paid leave (such as vacation, holiday, sick, and personal time), supplemental pay (including overtime, bonuses, and shift differentials), insurance benefits (such as health, life, and disability insurance), retirement and savings contributions (like pensions and 401(k) plans), and legally required benefits.
The latter category includes contributions to Social Security, Medicare, federal and state unemployment insurance, and workers’ compensation.
The figures shown represent compensation costs for all private sector employees — both full-time and part-time. All data is from March 2025.
To assess the relative cost of benefits in overall compensation, the labor burden rate was calculated by dividing total benefit costs by total wage and salary costs for each group.
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