PROVIDENCE – Rhode Island was ranked as the ninth most expensive state in the U.S. for hiring new employees, according to a study by financial technology company Tipalti.com.
The San Mateo, Calif.-based firm took the average annual salary in each state and multiplied it by state and federal payroll tax rates and worker benefits to reach the total cost per employee per year.
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Data showed Rhode Island employers pay an average of $17,124 in taxes and benefits each year for workers earning the average median salary of $62,120.
Alaska was the most expensive state in which to hire new workers, according to the report. Data showed Alaska employers paid an average of $18,991 in taxes and benefits each year for workers earning an average median salary of $63,480.
New York ranked second with $18,946 paid in taxes and benefits. New Jersey was third at $18,647. California was fifth at $18,330.
“Thanks to its relatively small population and limited provider competition, health care in Alaska is the most expensive in the country. This means employer health insurance contributions must be higher, and Alaska has a very wide margin.” with employers paying more than $800 more than New York in second place,” the report said.
Mississippi was the least expensive state in the nation for employers to hire employees, according to the report. The average employee in that state costs the employer $12,273 in taxes and benefits each year. Alabama and Arkansas were the second and third least expensive states to hire workers, respectively. In Alabama, the average cost to hire a worker is $12,943 each year, and in Arkansas, it costs an average of $12,996 each year. Louisiana and Tennessee rounded out the five least expensive states for employers to hire workers.
Massachusetts was the most expensive state in New England and sixth in the U.S. for employers to hire employees, according to the study. Employers in the Bay State pay an average of $18,207 in taxes and benefits each year for workers earning an average median salary of $72,940. Connecticut was the second most expensive state in New England and eighth in the U.S. Employers in that state pay an average of $18,330 in taxes and benefits each year for workers earning a median salary of $66, 510. New Hampshire was 13th in the U.S., Vermont was 20th and Maine was 22nd.
