ALBANYBetween 1999 and 2000, New York State's workers' compensation costs for manufacturers moved farther above the national average for those costs, an authoritative new study shows. Only nine states in the study were farther above the national average in these comp costs.
As costs in most states declined, New York manufacturers paid average workers' comp costs that were 29.9 percent higher than the national average in the 12 months ending January 1, 2000, according to the annual analysis of manufacturers' workers' compensation costs by Actuarial & Technical Solutions of Ronkonkoma, New York. (Click here to see tables from the study that rank states by costs and benefits.)
That contrasts with 1999 costs that were 20.9 percent higher than the national average in the same consulting firm's 1999 study for the 12-month period ending January 1, 1999.
"New York is still better off than it was before the reforms of 1996," said Business Council President Daniel B. Walsh, "but the evidence is mounting that New York is now losing ground to its competitors and that more workers' compensation reforms are needed."
In the new study's rankings of the states with the lowest comparative costs, New York ranked 36th among 45 states evaluated. Five states were not evaluated in the study because each of the five provides workers' compensation insurance exclusively through a state fund.
Comp costs as a key business-climate issue: Workers' compensation costs in New York have long been above the national average, and bringing these costs in line with costs in other states has long been a priority of The Business Council. Workers' compensation costs, especially for manufacturers, are considered a key indicator of a state's economic climate.
Recent history of New York's relative comp costs: Before the reforms of 1996, New York's costs were rated 57 percent above the national average in the same annual analysis by Actuarial & Technical Solutions.
In the 1997 study, these costs had fallen to the point where New York's costs were only 28.7 percent above national average. In 1998, New York's comp cost for manufacturers fell again and were only 20.4 percent higher than the national average as of January 1, 1998. In last year's analysis, the gap increased slightly, to 20.9 percent.
Key findings: Here are some notable rankings in the study:
- The state with the lowest comparative costs, Utah, had costs that were 58.6 percent below the national average.
- New York's bordering neighbors all performed better than New York in the analysis: Massachusetts (15 percent below the national average, ranked 15th), Pennsylvania (10.6 percent below the national average, ranked 21st); Vermont (2.2 percent below the national average, ranked 23rd); New Jersey (.03 percent below the national average, ranked 26th); and Connecticut (.01 percent above the national average, ranked 31st).
- New York's loss in relative position comes as overall comp costs are falling nationwide. The study concluded that manufacturers' national average comparative cost of workers' compensation had decreased by more than 8 percent compared to the same figure a year earlier.
- The 2000 study showed that manufacturers' average comp costs nationally had declined for the sixth consecutive year. Six states saw decreases in comparative costs of more than 20 percent in this year's study: Michigan, Montana, Louisiana, Massachusetts, South Carolina, and Pennsylvania.
- New York was identified as both a higher-cost and a higher-benefit state. Its comparative benefit ranking was 38th among all 50 states, with benefits that were 26.9 percent above the national average.
The study's calculations reflect states' manual rates as well as taxes and assessments that add to employers' total comp costs.