U.S. employers’ compensation costs rose 0.8% in the three months ended September, the Bureau of Labor Statistics reported October 30. That seasonally adjusted increase was smaller than the 0.9% recorded in the quarter ended June.
Wages and salaries increased 0.7% during the latest quarter, while benefit costs rose 0.9%. The figures describe changes in employers’ labor costs, rather than a uniform raise received by every worker.
Over the 12 months ended September, total civilian compensation increased 3.4% before adjustment for inflation. Wages and salaries rose 3.1%, and benefits increased 3.9%. Those annual comparisons are not seasonally adjusted.
The difference between nominal pay growth and purchasing power remained significant. Inflation-adjusted civilian wages and salaries fell 0.6% over the year, according to the release’s constant-dollar series.
Private-industry compensation also increased 0.8% during the quarter and 3.4% over the year. Within that group, annual compensation growth was 4.3% for union workers and 3.3% for nonunion workers. Those broad comparisons do not establish what happened to any particular employee’s compensation.
State and local government compensation rose 0.6% in the quarter and 3.5% over the year. Wages in that sector increased 3.2% annually, but fell 0.5% after inflation adjustment.
The Employment Cost Index measures changes in labor costs while controlling for shifts in employment among occupations and industries. It is distinct from a count of jobs created or a measure of unemployment.
The release reports the period through September; October 30 is the publication date. The BLS plans to publish December’s results January 29, 2027.
Sources: BLS — October 30 Employment Cost Index Release: https://www.bls.gov/news.release/eci.nr0.htm