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Bob Young

For Press Release:

ICIS Industry Score Card: Non-Durable Goods Manufacturing

The California Workers’ Compensation Institute has issued the sixth edition of its “Industry Score Card” which provides detailed data on accident year (AY) 2000 to 2008 claims experience among nondurable goods manufacturing workers in California. The new Score Card is based on a review of 136,742 job injury claims filed by workers involved in the manufacture of “soft goods” that are typically used or need to be replaced within a relatively short period – for example food items, apparel, and plastic goods. Total loss payments on these claims totaled nearly $1.78 billion. The Scorecard notes that workers in this sector accounted for 6.7% of all California job injury claims and 6.1% of paid losses reported during the 8-year span of the study, though with the decline in manufacturing in the state, those proportions have been dwindling, falling from 7.2% of claims and 7.7% of workers’ compensation loss payments in AY 2002 to 4.4% of the claims and 3.8% of paid losses in AY 2008.

The most common injuries for nondurable goods manufacturing workers are minor wounds and injuries to the skin, which account for about 1 in 5 claims, but less than 3% of paid benefits. On the other hand, medical back problems without spinal cord involvement (i.e., sprains and strains) rank second in terms of claim volume, with 20.3% of the claims, but are more likely to involve extended treatment and delayed return to work, so they account for nearly 30% of paid losses in this sector. Shoulder, knee, arm and lower leg sprains are the third most common injury category in nondurable goods manufacturing, accounting for about 13.2% of the claims and 9.5% of the payments, followed by “other injuries, poisonings and toxic effects” (12.4% of the claims, 14.3% of the payments). Both before and after the 2004 workers’ compensation reforms, a relatively high proportion of nondurable goods manufacturing claims resulted in permanent disability (PD), with these PD claims accounting for 92% of pre-reform losses, and more than 80% of post-reform losses. The average amount paid on lost-time claims in nondurable goods manufacturing declined briefly following passage of SB 899, though paid loss data for AY 2006 and AY 2007 show average payments at 12 and 24 months are again on the rise. For example, average first-year payments on a lost-time claim in this sector hit a low of $9,140 ($5,375 medical + $3,765 indemnity) in AY 2005, but by AY 2007 had jumped 38% to $12,583 ($7,933 medical + $4,650 indemnity).

The scorecard also features a profile of nondurable goods manufacturing claimants, plus claim distributions based on claimant job classification and county of residence, nature and cause of injury, and employer premium. Claim closure rates at 12, 24 and 36 months post injury also are provided by accident year for all claims and for lost-time claims. Pre- and post-reform claim and payment distributions by type of claim (med-only, temporary disability, permanent disability, and death) are shown, as are pre- and post-reform attorney involvement rates for nondurable goods manufacturing PD claims, with comparative distributions for PD claims from all sectors.

The CWCI’s Industry Score Card Series and summary Bulletins are available to CWCI members and research subscribers who log on to CWCI’s web site, www.cwci.org. Anyone wishing to subscribe may do so by visiting the Institute’s online Store. The next Score Card in the series will focus on restaurant claims.