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Economy

Employment Cost Index: Benefit Costs Rising Faster Than Wages

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By Jon C. Ogg Updated Published

Inflation in wages is not really present right now. A report for the third quarter showed that the Employment Cost Index slipped to +0.4% from +0.5% in the second quarter. Bloomberg was calling for a reading of +0.5% today, but that appears to be rounded up as the range was 0.4% to 0.5% for the third quarter. Dow Jones also had a consensus of 0.5% for the third quarter.

Wages and salaries fell to a 0.3% gain in the third quarter after a gain of 0.4% in the second quarter. The cost of benefits were up by 0.8% after a gain of 0.6% in the second quarter. On a year-ago basis, wages and salaries are up by 1.7% and the cost of benefits are up by 2.6%.

Today’s report is ahead of Friday’s nonfarm payrolls and unemployment, but as it is a third-quarter report, this is not going to have any impact on Friday’s report. This is also a low-impact report because so many reports on wages and unit labor costs have already been seen.

JON C. OGG

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About the Author Jon C. Ogg →

Jon Ogg has been a financial news analyst since 1997. Mr. Ogg set up one of the first audio squawk box services for traders called TTN, which he sold in 2003. He has previously worked as a licensed broker to some of the top U.S. and E.U. financial institutions, managed capital, and has raised private capital at the seed and venture stage. He has lived in Copenhagen, Denmark, as well as New York and Chicago, and he now lives in Houston, Texas. Jon received a Bachelor of Business Administration in finance at University of Houston in 1992. www.247wallst.com.

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