American manufacturers pay more than twice as much per hour for health benefits as the manufacturers in countries we regularly trade with, according to a new report by the New America Foundation that found for every $2.38 an hour paid for benefits by US manufacturers, others pay about $0.96. It’s a losing proposition all around that:
- Makes our products more expensive — read: less competitive. (ie. an American-made car costs $1,500 more due to health costs versus $900 more by foreign competitors.
- Results in American businesses trying to ratchet down what they pay in health care costs, and resulting in crappier coverage for their workers. (for more money, I might add)
- Results in jobs going overseas — like Ford going to Canada as reported earlier this week.
The report runs through a litany of interesting stats, including:
- In 1960, health benefits were only 1.2% of payroll. Now, it’s more like 9.9% (averaged across all businesses, including those that *don’t* provide coverage).
- Since 2000, fewer employers are offering coverage (from 69% to 60%). But for workers that *do* get coverage on the job, it’s costing more — 102% more (from $135 to $273 monthly premium).
It also acknowledges that not all costs can be shifted to workers, either in higher premiums and out-of-pocket costs or lost wages, because it would affect a business’ ability to be competitive in hiring good quality employees — something all businesses must grapple with in order to stay competitive. And that the cost of health care can’t depress wages — particularly for those already making minimum wage ($5.85 or $8 in CA), or in cases where a labor contract acts as a backstop.