Updated: 31-Jan-24 09:18 ET
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Updated: 31-Jan-24 09:18 ET |
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Highlights
- The Q4 Employment Cost Index was up 0.9% (Briefing.com consensus 1.0%), seasonally adjusted, for the three-month period ending in December 2023. That was the smallest gain since the second quarter of 2021.
- Wages and salaries were up 0.9% and benefit costs increased 0.7%.
Key Factors
- Compensation costs for civilian workers rose 4.2% for the 12-month period ending in December 2023 versus 5.1% for the 12-month period ending in December 2022. Wages and salaries increased 4.3% for the 12-month period ending December 2023 versus 5.1% for December 2022. Benefit costs increased 3.8% for the 12-month period ending in December 2023 versus 4.9% for December 2022.
- Compensation costs for private industry workers rose 4.1% for the 12-month period ending in December 2023 versus 5.1% for the 12-month period ending in December 2022. Wages and salaries increased 4.3% for the 12-month period ending December 2023 versus 5.1% for December 2022. Benefit costs increased 3.6% for the 12-month period ending in December 2023 versus 4.8% for December 2022.
- Compensation costs for state and local government workers rose 4.6% for the 12-month period ending in December 2023 versus 4.8% for December 2022. Wages and salaries increased 4.7% for the 12-month period ending December 2023 versus 4.7% for December 2022. Benefit costs increased 4.6% for the 12-month period ending December 2023 versus 5.0% for December 2022.
Big Picture
- The key takeaway from the report, which Fed Chair Powell keeps a close eye on, is that it shows disinflation in employment costs, offering another signal after the core-PCE Price Index for December that inflation trends are moving in the right direction.
Category |
Q4 |
Q3 |
Q2 |
Q1 |
Q4 |
Quarterly Changes |
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Total ECI |
0.9% |
1.1% |
1.0% |
1.2% |
1.1% |
Wages and Salaries |
0.9% |
1.2% |
1.0% |
1.2% |
1.2% |
Benefits |
0.7% |
0.9% |
0.9% |
1.2% |
1.0% |
Year/Year Changes |
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Total ECI |
4.2% |
4.3% |
4.5% |
4.8% |
5.1% |
Wages and Salaries |
4.3% |
4.6% |
4.6% |
5.0% |
5.1% |
Benefits |
3.8% |
4.1% |
4.2% |
4.5% |
4.9% |