October 30, 2020

The employment cost index for civilian workers climbed at a 2.0% rate in the third quarter after having risen at a 2.0% pace in the second quarter.   Over the course of the past year it has risen 2.5%.

With the unemployment rate having climbed to 14.7% in April and remaining high at 7.9% in September, 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 1.7% rate in the third quarter after rising 1.4% in the second quarter..  Wages  and have risen 2.5% in the past year, slightly slower than in the past couple of years.

Benefits climbed at a 2.2% rate in the third quarter after jumping by 3.1% in the second quarter.  Over the past year benefits have risen 2.3%.

Stephen Slifer

NumberNomics

Charleston, SC