A measure of total employee compensation costs, including wages and salaries as well as benefits. The employment cost index (ECI) is the broadest measure of labor costs. Why Investors Care
| Released on 10/31/07 For Q3 2007 | |||||||||||||||||||
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Highlights
The employment cost index showed moderate but non-accelerating pressure in the third-quarter, up 0.8 percent for a year-on-year rate of 3.3 percent that is unchanged from the second quarter. These numbers have been very steady over the past year. Wages and salaries were unchanged in the third quarter while growth in benefit costs slowed. Federal Reserve officials pay extra close attention to the ECI report for the slightest indication of wage or benefit pressures. Today's report will likely weigh on the side of a rate cut.
The employment cost index for civilian workers rose 0.9 percent in the second quarter for a year-on-year pace of 3.3 percent. These overall rates are moderate but there are cross currents in wage inflation between a labor market in which skilled labor is hard to find and an overall economy that appears to be slowing. The Fed will be picking apart these numbers just prior to its interest rate decision Wednesday afternoon.
Employment cost index Consensus Forecast for Q3 07: +0.9 percent simple quarterly rate
Range: +0.9 to +1.0 percent simple quarterly rate
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The employment cost index measured total compensation costs which include wages and salaries and also benefits. Benefits include vacations, but the primary mover is health insurance premiums. |
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