Businesses managing to maintain employee benefits are likely to find their efforts paying off when the economy emerges from the intensive care unit. That's the word from Dallas Salisbury, president of the Employee Benefits Research Institute.While credit unions haven't seen anything approaching the layoffs and closings hitting other industries, many appear nervous and are taking such steps as postponing salary increases and incentive programs, holding off on hiring and pulling in-house work that was formerly outsourced.Data on the EBRI Web site (www.ebri.org) compiled from the U.S. Department of Commerce shows employers spent nearly $8 trillion on total compensation for workers in 2007, the latest period available. Of that total, $6.4 trillion went for wages and salaries while benefits accounted for $1.5 trillion, or 18.6%. Employer spending on health benefits is beginning to approach the amount spent on retirement benefits.Salisbury said he's seen employers trying to curb those costs in a number of ways-modifying health benefits and moving toward high deductible plans and larger co-payments, reducing payments for ancillary health benefits such as dental care, trimming life insurance coverage and freezing defined benefit pension plans so new employees do not qualify."On the defined contribution side, we are seeing a slowly rolling process of employers temporarily suspending their matching contributions," Salisbury said. "The list of large employers who have done that is now up to about 45 very large companies, which means it affects lots of people."If credit unions are in better shape than banks and if the benefit cost-cutting steps they take are less dramatic than those at banks and other financial institutions, does that suggest they will be in better shape when the economy does recover?Salisbury said that's definitely the case."The entity that can maintain its benefits through this process is going to be in the strongest position in terms of retaining employees and adding to the workforce. If a credit union can show that, during the worst trouble since the Great Depression, it worked its way through it and honored all its commitments, it will have earned loyalty," he said."If you can retain your existing programs, do so. When times are tough is when you can build your strongest bonds with your workers. Don't be shy about communicating to your employees that you're doing this as a matter of conscious decision making. It may squeeze earnings a little, but it is important."Salisbury noted that President Obama has indicated that if the measures he puts in place work, the economy may start to turn around in 2010. That suggests tough times through 2009 and into the start of 2010."Part of what's driving employers to take the actions they're taking, including a fairly heavy level of layoffs, is the belief it is indeed going to be a prolonged and deep recession," Salisbury said.Historically, as the economy has improved after previous recessions employers have restored many benefits. But Salisbury cautioned the current slump is different. While earlier downturns have been part of a recurring economic cycle, the current recession stems from overextension of individual credit and overuse of leverage by individuals, banks and others.The impact was dramatic when the bubble of individual and corporate balance sheets burst."As a practical matter, this is really the first recession that followed a process of American citizens, for the better part of two decades, refinancing and refinancing and refinancing their homes and pulling out cash, pulling out cash and pulling out cash. Essentially they were living well beyond their income," Salisbury said.Salisbury said he knows people who have lived in their current home 30 years and are underwater because they drew out so much of their home equity. People lived as though their income was 30% higher than it actually was.Working out of that is going to be longer and tougher than pulling out of a normal recession, he believes.–[email protected]