Global| Jul 29 2016U.S. Employment Cost Index Shows Steady Gain
Summary
The employment cost index for civilian workers increased 0.6% (2.3% y/y) during Q2'16 following a similar Q1 rise. This latest gain was in line with the Action Economics Forecast Survey. Wages and salaries also increased 0.6% (2.5% [...]
The employment cost index for civilian workers increased 0.6% (2.3% y/y) during Q2'16 following a similar Q1 rise. This latest gain was in line with the Action Economics Forecast Survey. Wages and salaries also increased 0.6% (2.5% y/y) after a 0.7% rise, and benefits rose 0.5% (2.0% y/y), the same their Q1 gain.
The employment cost index for private industry workers also went up 0.6% in Q2'16 (2.4% y/y), the same as in Q1. Among industries, the index for manufacturing workers rose 0.5% (2.3% y/y), a bit easier than the 0.6% in Q1. Construction worker compensation also slowed, to 0.5% in Q2 (2.5% y/y) from 0.8% in Q1. Service industries were somewhat mixed, with trade, transportation and utilities up 1.2% in Q2 (3.0% y/y) from 0.7% in Q1, and information up 0.7% (1.8% y/y) from 0.1%. But compensation of finance industry workers gained only 0.2% in Q2 (1.9% y/y), down from 0.7% in Q1. Education and health sector workers pay was up 0.4% (1.9% y/y) in Q2 versus 0.6% the quarter before. Leisure and hospitality sector workers saw their compensation rise 1.1% (2.6% y/y), just a bit more than the 1.0% in Q1. In the public sector, compensation of state and local government workers was up 0.5% (2.3% y/y), the same as in Q1.
Wages and salaries in private industry rose 0.6% (2.5% y/y) in Q2 following a 0.7% increase the quarter before. Factory sector wages were also up 0.6% (2.5% y/y) and 0.7% in Q1, and the gain in the construction sector was 0.5% (2.7% y/y), down from 0.8% in Q1. Wage gains in service industries generally improved in Q2, with trade, transportation and utilities up 1.0% (2.9% y/y) from 0.8% in Q1, and the information sector up 1.2% (2.7% y/y) from 0.5%. Professional and business service wages and salaries gained 0.9% (3.0% y/y), up from 0.4% in Q1. As with total compensation, the finance sector saw a slowdown, to 0.3% (2.2% y/y) from 0.9% in Q1. Leisure and hospitality wages were firm at 1.1% (2.9% y/y, the same as in Q1. State and local government workers' wage gains were steady at 0.4% (1.7% y/y).
Benefits for private industry workers grew 0.4% (1.7% y/y) in Q2, following a 0.5% increase in Q1. The rise in manufacturing was steady at 0.4% (1.8% y/y), and the construction, natural resources and maintenance occupations saw a 0.3% (1.6% y/y) benefit increase, up slightly from 0.2% in Q1. Private service industry benefits overall firmed in Q2 to a 0.6% advance (1.8% y/y) from 0.3% in Q1. In the public sector, state and local government worker benefits again increased 0.6% (3.4% y/y), the same as in Q1.
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.
Carol Stone, CBE
AuthorMore in Author Profile »Carol Stone, CBE came to Haver Analytics in 2003 following more than 35 years as a financial market economist at major Wall Street financial institutions, most especially Merrill Lynch and Nomura Securities. She has broad experience in analysis and forecasting of flow-of-funds accounts, the federal budget and Federal Reserve operations. At Nomura Securites, among other duties, she developed various indicator forecasting tools and edited a daily global publication produced in London and New York for readers in Tokyo. At Haver Analytics, Carol is a member of the Research Department, aiding database managers with research and documentation efforts, as well as posting commentary on select economic reports. In addition, she conducts Ways-of-the-World, a blog on economic issues for an Episcopal-Church-affiliated website, The Geranium Farm. During her career, Carol served as an officer of the Money Marketeers and the Downtown Economists Club. She has a PhD from NYU's Stern School of Business. She lives in Brooklyn, New York, and has a weekend home on Long Island.
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