Total compensation costs for civilian workers increased 0.9 percent from March to June 2006, seasonally adjusted, following a more modest 0.6 percent gain from December 2005 to March 2006, the Bureau of Labor Statistics of the U.S. Department of Labor reported July 28. Benefit costs between March and June rose 0.8 percent, greater than the gain of 0.5 percent from the previous quarter. Wages and salaries increased 0.9 percent during the quarter, compared with the 0.7 percent gain of the previous quarter. The Employment Cost Index (ECI), a component of the National Compensation Survey, measures quarterly changes in compensation costs, which include wages, salaries and employer costs for employee benefits for civilian workers (non-farm private industry and state and local government).
The ECI converted to the 2002 North American Industry Classification System and the 2000 Standard Occupational Classification System with the release of the March 2006 estimates. In addition, several computational changes were introduced in March, including rebasing all series to December 2005 = 100 from June 1989 = 100 and the introduction of new employment weights. Beginning in March 2007, all "white-collar occupations," "blue-collar occupations," and "excluding sales occupations" series will be discontinued, along with durable and nondurable manufacturing estimates. For more information on the changes, see the BLS website http://www.bls.gov/ncs/ect/sp/ecsm0001.htm.
Quarterly changes, seasonally adjusted
Compensation costs for the private sector rose 0.8 percent from March to June, after advancing 0.6 percent in the prior quarter. Wages and salaries of civilian workers and private industry both rose 0.9 percent in the June quarter, compared with an increase of 0.7 percent in the prior quarter.
Benefit costs advanced 0.8 percent for civilian workers in the June quarter, compared with a 0.5 percent gain in the March quarter. Private sector benefit costs rose 0.7 percent for the June quarter, following a 0.4 percent gain in the previous quarter.
Over-the-year changes, not seasonally adjusted
Annual compensation costs for civilian workers increased 3.0 percent for the year ended June 2006, compared with a 3.2 percent over-the-year increase for June 2005. Compensation costs in private industry rose 2.8 percent in the year ended June 2006, compared with a 3.1 percent increase in June 2005.
The components of compensation differed in their rates of change. While increases in wages and salaries continued at a moderate pace, the sharp increases in benefit costs seen for civilian and private industry workers over the past several years slowed to a more moderate pace. For civilian workers, wages and salaries rose 2.8 percent in the year ended June 2006, compared with a gain of 2.5 percent in June 2005 and 2.6 percent in June 2004. Benefit costs gained 3.4 percent for civilian workers for the year ended June 2006, slowing sharply from increases of 5.0 percent for the year ended June 2005 and 7.1 percent for the year ended June 2004.
Non-farm private industry
For the year ended June 2006, compensation costs increased 2.3 percent for goods-producing industries, sharply lower than the increase of 3.8 percent for the year ended June 2005. The rise in compensation costs for manufacturing moderated for the year ending June 2006, advancing 1.9 percent compared with the 3.7 percent gain in June 2005. Compensation costs for construction rose 3.5 percent in June 2006, compared with a 3.2 percent gain in June 2005.
Among white-collar occupational groups, over-the-year compensation cost gains for the year ended June 2006 ranged from 2.4 percent for management, business, and financial workers, to 3.3 percent for sales and related employees. Among blue-collar occupational groups, compensation cost changes ranged from 1.9 percent for production workers to 3.5 percent for construction and extraction workers. Compensation costs for service workers gained 2.5 percent for the year ended June 2006.
Compensation costs for union workers advanced 3.0 percent over the year ended June 2006, unchanged from the year ended June 2005. For non-union workers, compensation costs rose 2.8 percent for the year ended June 2006, compared with a gain of 3.1 percent in June 2005. Wages and salaries for non-union workers rose 2.9 percent for the 12 months ended in June 2006, compared with an over-the-year increase of 2.5 percent for union workers. Benefit costs for union workers rose 3.8 percent, compared with the 2.5 percent gain for non-union workers in June 2006.
In manufacturing industries, compensation cost gains for union workers rose 1.0 percent for year ended June 2006, compared with the 2.5 percent gain in June 2005. For non-union workers in manufacturing, compensation costs rose 2.2 percent for the year ended June 2006, slowing from the over-the-year gain of 4.0 percent in June 2005.
Among the four geographic regions, increases in compensation costs ranged from 2.3 percent in the South to 3.4 percent in the Northeast and