July 31, 2020

The employment cost index for civilian workers climbed at a 2.0% rate in the second quarter after having risen at a 3.2% pace in the first quarter.   Over the course of the past year it has risen 2.7%.

With the unemployment rate having climbed to 14.7% in April but remaining high at 11.1% in June, there is no longer going to be upward pressure on wages caused by the very tight labor market.  Quite the opposite.

Wages climbed at a 1.4% rate in the second quarter after having risen  3.8% rate in the first quarter.  Wages  and have risen 2.9% in the past year.

Benefits climbed at a 3.1% rate in the second quarter after having risen 1.4% rate in the first quarter.  Over the past year benefits have risen 2.3%.

Stephen Slifer

NumberNomics

Charleston, SC