Rising Fuel Costs Driving U.S. Employers to Help Employees Cope, New TransitCenter Survey Finds

With a Nearly 100% Rise in the Cost of Fuel since 2003, More Employers Have Turned To Commuter Benefits, Flex-Time, Telecommuting and Carpools to Aid Employees

A new survey of U.S. human resource executives across public, private, nonprofit and government organizations finds that more than 60 percent of employers are "extremely" or "very" concerned about the impact of rising fuel and commuting costs on employees. Leading their list of worries are wage inflation, hiring difficulties, and the cost of taking further steps to help employees cope. TransitCenter, a nonprofit organization that promotes the use of mass transit, independently fielded the survey at the June 2006 Society for Human Resource Management Annual Conference & Exposition with responses from 312 human resource professionals representing employers of all sizes nationwide.

The survey found that the most common ways employers are helping their employees manage are flex-time and telecommuting, offered respectively by 43 percent and 27 percent of those surveyed. Other popular options include encouraging carpools (16 percent), offering tax-free commuter benefits (15 percent) and facilitating vanpools (11 percent). Some employers (9 percent) also say they have increased employee compensation in response to the climbing cost of fuel. And one in five respondents say they are planning to take additional steps to help their employees manage, with 32 percent planning to add a commuter benefits program.

"The findings of this survey should serve as a real call-to-action for employers," said Larry Filler, president and CEO of TransitCenter. "Commuting to work is a necessary cost of employment, and it's a burden that has become a chief concern for the nation's workforce. More employers are stepping in and helping employees deal with these escalating costs by encouraging alternatives to drive-alone commuting and providing programs that reduce the cost of getting to and from work."

Driving employer concern today is the impact that fuel costs could have on recruitment, employee retention, morale and wage inflation:

-- 72 percent of human resource professionals express concern that rising costs will affect employee salaries;

-- 63 percent of those surveyed worry about managing additional costs associated with new efforts to help their employees;

-- 60 percent foresee greater difficulty in hiring qualified employees; 59 percent say they are worried that rising costs will spur employees to seek jobs closer to home; and

-- Nearly half of respondents (49 percent) believe that the growing burden on employees will lead to reduced morale, and 42 percent expect increased absenteeism.

Unlike widely known benefits such as flex-time and telecommuting, the survey indicated that tax-free commuter benefits programs are a solution that less than half of the nation's employers are aware of. In contrast to their peers across the country, employers from the New York metropolitan area, the largest mass transit market in North America, have a higher level of awareness of commuter benefits at 63 percent, with 45 percent of those employers actually offering a tax-free commuter benefits program to their employees.

Approved by the Internal Revenue Service, tax-free commuter benefits allow employees to set aside up to $105 a month of their pre-tax earnings to pay for transit commuting costs, and up to $205 a month for commuter parking, and save an average of 30 to 40 percent on out-of-pocket expenses associated with commuting. Offering tax-free commuter benefits can also help employers reduce their payroll taxes.

TransitCenter, which introduced TransitChek, the nation's first tax-free commuter benefits program in 1987, offers services to help employers determine if a program is right for them and their employees. The organization consults on employee surveys, offers best practices in implementing commuter benefits programs, and in expanding employee participation for public, private and nonprofit and government employers nationwide.

A copy of the full report is available upon request by contacting Charles Kim at ckim@transitcenter.com.

About TransitCenter

A nonprofit corporation, TransitCenter specializes in tax-free commuter benefits, transit information and assistance for employers and commuters nationwide. TransitCenter introduced the nation's first tax-free commuter benefits program in 1987 to encourage more people to use mass transit to protect the environment, preserve natural resources and improve the quality of life where people work and live. Today, more than 11,000 employers and 500,000 employees participate in TransitCenter's TransitChek commuter benefits programs as a convenient, money-saving way to pay for commuting.

For 20 years, TransitCenter has worked hand-in-hand with transit providers, communities and employers to make mass transit more accessible. Independent since 2001, TransitCenter was founded in 1986 as a joint alliance of leading public transit providers. A deep heritage in transit drives TransitCenter's continued commitment to bringing new innovations to employers and transit riders that participate in TransitChek tax-free commuter benefits programs. Learn more by visiting www.transitcenter.com.

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