December 1999 Employment Cost Index

Historical release narrative reproduced from the official public-domain source. Statistical tables, standard technical appendices, administrative material and attendance rosters are omitted; formatting is adapted for reading. Figures retain the release's historical context and may have been revised. Consult the linked source for the complete document.

The Employment Cost Index for December 1999 was 144.6 (June 1989=100), not seasonally adjusted, an increase of 3.4 percent from December 1998, the U.S. Department of Labor's Bureau of Labor Statistics reported today. The Employment Cost Index (ECI) measures changes in compensation costs, which include wages, salaries, and employer costs for employee benefits.

Quarterly changes, seasonally adjusted

On a seasonally adjusted basis, the 3-month increase in compensation costs for civilian workers (nonfarm private industry plus State and local government) was 1.1 percent during the September-December 1999 period, following a gain of 0.8 percent in June-September. Wages and salaries increased 0.9 percent during the September-December 1999 period, the same increase as in the previous quarter. Benefit costs rose 1.3 percent during the December 1999 quarter, up from a 0.8 percent increase in the September 1999 quarter.

The 3-month increase in compensation costs for private industry workers was 1.0 percent during the September-December 1999 period. The gain in wages and salaries also was 1.0 percent in December; in September, it was 0.8 percent. Benefit costs showed a 3-month rise of 1.4 percent during the December quarter, compared with 0.9 percent during the September period. (See tables A and 1.)

Compensation costs for State and local government workers increased 1.1 percent during the September-December 1999 period; in the September period, it was 0.8 percent. Wages and salaries rose 1.1 percent in December; in September, the increase was 0.9 percent. Benefit costs increased 1.4 percent in the December quarter, up from 0.3 percent in the previous quarter. The large increase in State and local government benefit costs was due, in part, to increases in health insurance and paid leave.

Over-the-year changes, not seasonally adjusted

Compensation costs for civilian workers (not seasonally adjusted) increased 3.4 percent for the year ended in December 1999. This compares with over-the-year increases of 3.4 percent in December 1998 and 3.3 percent in December 1997. Compensation costs in private industry also rose 3.4 percent in December 1999, following increases of 3.5 percent in December 1998 and 3.4 percent in December 1997. Compensation costs in State and local government increased 3.4 percent for the year ended December 1999; over-the-year increases were 3.0 percent in December 1998 and 2.3 percent in December 1997. (See tables B, 2, and 3.)

Nonfarm private industry

In private industry, wages and salaries rose 3.5 percent for the year ended December 1999, after increasing 3.9 percent in the year ended December 1998. (See tables B and 6.) Benefit costs for private industry workers increased 3.4 percent for the year ended in December 1999, compared with 2.4 percent in December 1998. (See chart A and tables B and 8.)

In private industry, over-the-year compensation cost increases were 3.5 percent for white-collar occupations, 3.3 percent for blue-collar occupations, and 3.3 percent for service occupations. (See table 3.)

For the year ended December 1999, the private industry compensation cost increase was 3.4 percent for both service-producing and goods- producing industries. For the year ended in December 1998, compensation costs rose 3.8 percent in service-producing industries and 2.8 percent in goods-producing industries. (See table 3.)

The compensation cost change for nonunion workers in private industry was 3.6 percent over the year, while the change for union workers was 2.7 percent. In service-producing industries, union compensation increased 2.1 percent, and nonunion compensation increased 3.6 percent. In goods- producing industries, the increase for union workers was 3.2 percent, and the increase for nonunion workers was 3.5 percent. Compensation in blue- collar occupations increased 2.7 percent for union workers and 3.7 percent for nonunion workers. (See table 4.)

State and local government

In State and local government, the December 1999 over-the-year increase in wages and salaries was 3.6 percent, as compared with a 3.1 percent increase in December 1998. Benefit costs in December 1999 increased 2.8 percent. In December 1998, the increase was 3.0 percent. (See tables 5 and 8.)

In June 2000, the Bureau of Labor Statistics plans to expand the definition of nonproduction bonuses in the ECI to represent better the compensation packages offered to employees. In addition to the traditional types of nonproduction bonuses, such as attendance bonuses and lump sum payments, the ECI will include hiring and referral bonuses. Hiring bonuses are payments made by the employer to induce an individual to accept employment; referral bonuses are made by the employer to an employee for recommending an applicant who is hired by the establishment.

As part of its ongoing research program, the Bureau of Labor Statistics is currently conducting research on stock option plans. This research will be completed in stages. Beginning in early 2000, the BLS will conduct a test survey of the incidence of stock option plans across all industries and occupations. The prevalence of these plans, based on test results, and the potential impact on compensation costs will determine the next stage of research. The results of the incidence survey will be published in late 2000.

ECI data are available on the ECI home page (http://stats.bls.gov/ecthome.htm). To access data using Anonymous FTP, use the Internet address (ftp://ftp.bls.gov).

For technical assistance in using the BLS Internet site, send e-mail to (labstat.helpdesk@bls.gov). For ECI data requests, send e-mail to (ocltinfo@bls.gov).

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