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Economy in Brief

U.S. Employment Cost Index Bounces Back
by Tom Moeller  October 30, 2015

The employment cost index for private industry workers improved 0.6% in Q3'15 (1.9% y/y), following an unrevised zero change during Q2. The number matched expectations in the Action Economics Forecast Survey. The index for the professional & business services sector posted a 1.0% gain (1.7% y/y) but that followed a 1.2% decline. Trade, transportation & utility workers realized 1.0% growth (2.3% y/y) which built on a 0.6% rise. Information sector compensation rose 0.7% (-1.5% y/y), but that didn't make up the 3.6% Q2 decline. Factory sector compensation improved a lesser 0.4% (2.3% y/y) after a 0.7% increase. Education & health services workers realized 0.3% growth (1.9% y/y) after a 0.4% increase. In the public sector, state & local government workers compensation rose 0.6% (2.3% y/y), the same as in Q2.

Wages in private industry rose 0.7% (2.1% y/y) following a 0.2% increase. Workers in professional & business services realized 1.2% wage growth (2.0% y/y) and that followed a 1.3% decrease. Trade, transportation & utility wages grew 1.1% (2.2% y/y) after a 1.1% rise. Information sector wages rose 0.6% (2.4% y/y) for the fourth consecutive quarter. Wages in leisure & hospitality declined 0.3% (+1.6% y/y) following 0.7% rise. Factory sector wages grew a fairly steady 0.6% (2.5% y/y) but construction wages advanced a lessened 0.6% (2.4% y/y). Wages for state & local government workers improved 0.3% (1.8% y/y) after a 0.6% gain.

Benefits of private industry workers grew 0.5% (1.3% y/y) following a 0.2% decline. Sales & office workers realized 0.6% growth (1.4% y/y) after a 0.1% uptick. Workers in service occupations saw only a 0.5% increase (1.8% y/y) and management & professional workers saw 0.3% growth (1.0% y/y). Factory sector workers realized only a 0.1% uptick (1.9% y/y) in benefits but that followed several quarters of strength. State & local government workers realized a 0.7% increase (3.0% y/y), on a par with growth this decade.

The employment cost index figures are available in Haver's USECON database. Consensus estimates come from the Action Economics survey, carried in Haver's AS1REPNA database.

Private Industry Workers (%) Q3'15 Q2'15 Q1'15 y/y 2014 2013 2012
Compensation 0.6 0.0 0.7 1.9 2.1 1.9 1.9
 Wages & Salaries 0.7 0.2 0.7 2.1 2.0 1.9 1.8
 Benefit Costs 0.5 -0.2 0.6 1.3 2.3 1.9 2.3
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