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Kids Count Commentary Series Part 3: Supporting Working Families – Benefits

On January 29th, Voices for Children released the 22nd annual Kids Count in Nebraska Report. This year’s report is our biggest and most comprehensive edition to date. Every year in the Kids Count report, we include a timely commentary providing a deeper look at an issue important to the work we do here at Voices. In this year’s commentary topic, we took a look at how our state can support working families. Today, the third post in the commentary series explores Nebraska worker’s benefits. Check out the first two posts in the series: employment and income, and poverty and the family bottom line.

Benefits

Employee benefits in the United States exist as a partnership between individuals, business, and the government. They are intended to promote the economic security of employees by ensuring against uncertain events and to raise the standard of living by providing services, like health insurance. Benefit programs help the economy as a whole by helping to secure the income and well-being of families. Benefits can also help ensure that workers can balance work and family life. Types of employee benefits are varied with some being optional and others being mandatory.

In Nebraska, only 36.9% of employers offered health insurance in 2012, ranking Nebraska in last place in the nation, but 62.9% of Nebraskans are insured through employer-provided health insurance. Employee sponsored health coverage has numerous benefits to both the employer and employee including reducing employee absenteeism, cost savings on group coverage, and heightened job satisfaction, engagement and tenure of employees.

At some point in their working lives, just about everyone will need to take time off from work for family or medical reasons, such as the birth of a child, an ill family member, or personal injury. Paid family leave makes taking this time off possible. Currently, Nebraska participates in the Federal Family and Medical Leave Act (FMLA). FMLA entitles eligible employees of large private sector employers and all schools and public agencies to up to 12 weeks of unpaid leave for family or medical reasons. Nebraska does not require this time to be paid and companies are not required to provide any paid time off, but many do. In our census region a majority of workers do have paid sick leave, paid vacation and paid holidays, but for those that do not, their jobs and financial stability can be compromised by unexpected events like a health crisis.

Retirement savings are important for economic security in senior years of life, but too many Americans put aside too little for retirement despite the range of tax incentives. Higher-income workers disproportionately use retirement savings tax incentives with 70% of middle- to high-income workers participating in employer sponsored retirement plans, but only 25% of individuals making $15,000-$20,000 participate. Similarly, investment in Individual Retirement Accounts (IRAs) increases disproportionately with income. Those without savings for retirement tend to be populations with lower education, poor health and part-time workers. 48.4% of workers in Nebraska participated in an employment-based retirement plan in 2012.

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