June 2000 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 (not seasonally adjusted) for June 2000 was 148.0 (June 1989=100), an increase of 4.4 percent from June 1999, 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 1.0 percent during the March-June 2000 period, following a gain of 1.4 percent in December 1999-March 2000. Wages and salaries increased 1.0 percent during the March-June 2000 period, following a 1.1 percent increase in the previous 3-month period. Benefit costs rose 1.1 percent during the June 2000 quarter, falling from the 2.0 percent increase in the March 2000 quarter.

NOTE This release incorporates an expanded definition of nonproduction bonuses. See page 3 for details.

The 3-month increase in compensation costs for private industry workers was 1.1 percent during the March-June 2000 period. The gain in wages and salaries was 1.0 percent in June; in March, it was 1.2 percent. Benefit costs showed a 3-month rise of 1.2 percent during the June quarter, falling from the 2.3 percent gain during the March period. (See tables A and 1.) The moderation in benefits was due to smaller increases in benefit costs across the board.

Compensation costs for State and local government workers increased 0.8 percent during the March-June 2000 period, unchanged from the previous quarter. Wages and salaries rose 0.8 percent in June, following a gain of 0.9 percent in March. Benefit costs increased 0.5 percent in the June quarter; in March, the increase was 1.0 percent.

Over-the-year changes, not seasonally adjusted

Compensation costs for civilian workers (not seasonally adjusted) increased 4.4 percent for the year ended in June 2000. This compares with over-the-year increases of 3.2 percent in June 1999 and 3.5 percent in June 1998. Compensation costs in private industry rose 4.6 percent in the year ended June 2000, following increases of 3.3 percent in June 1999 and 3.5 percent in June 1998. In State and local government, compensation costs increased 3.5 percent for the year ended June 2000; over-the-year increases were 3.0 percent in June 1999 and 2.7 percent in June 1998. (See tables B, 2, and 3.)

Nonfarm private industry

In private industry, wages and salaries rose 4.1 percent for the year ended June 2000. Wages and salaries increased 3.6 percent in June 1999. (See tables B and 6.) Benefit costs for private industry workers increased 5.7 percent for the year ended in June 2000, a significant increase from 2.5 percent in June 1999. (See chart A and tables B and 8.) The rise in benefit costs were due, in part, to higher payments for health insurance, supplemental pay, and paid leave.

In private industry, over-the-year compensation cost increases were 4.9 percent for white-collar occupations, 4.3 percent for blue-collar occupations, and 3.4 percent for service occupations. Among the occupational groups, increases in compensation costs ranged from 3.7 percent for transportation and material moving to 5.4 percent for sales occupations. (See table 3.)

For the year ended June 2000, the compensation cost increase was 4.8 percent for goods-producing industries, compared with 2.7 percent for the year ended June 1999. The over-the-year increase in compensation costs for service-producing industries was 4.4 percent, compared with an increase of 3.6 percent for the year ended June 1999. Among industry divisions, June 1999-to-June 2000 increases ranged from 2.7 percent in transportation to 5.7 percent in banking, savings and loan, and other credit agencies. (See table 3.)

Over-the-year compensation cost increases for nonunion workers were 4.6 percent, higher than the 3.9 percent gain for union workers. Similarly, compensation in service-producing industries increased 4.6 percent for nonunion workers, higher than the 3.0 percent gain for union workers. In contrast, in goods-producing industries, the increase for both union and nonunion workers was 4.8 percent. Compensation in blue- collar occupations rose 4.2 percent for both union and nonunion workers. (See table 4.)

State and local government

In State and local government, the June 2000 over-the-year increase in wages and salaries was 3.7 percent, higher than the 3.1 percent increase in June 1999. Benefit costs for June 2000 increased 3.1 percent. In June 1999, the increase was 2.6 percent. (See tables 5 and 8.)

This release introduces an expanded definition of nonproduction bonuses designed to improve the ECI's representation of the compensation packages offered to employees. In addition to the traditional types of nonproduction bonuses such as attendance bonuses and lump sum payments, the June ECI includes hiring and referral bonuses. Hiring bonuses are payments made by the employer to induce an individual to accept employment; referral bonuses are payments made by the employer for recommending an applicant who is hired by the establishment. A fact sheet has been prepared with additional information on this change and its effect on the ECI. This information can be obtained directly from the Internet site (http://stats.bls.gov/ecthome.htm), by e-mail request (ocltinfo@bls.gov), or by telephone (202) 691-6199.

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. BLS has completed the collection of a test survey to determine 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 fall 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).

The ECI news release is now available through an e-mail subscription service. Please see the subscription link on (http://stats.bls.gov/ecthome.htm) or (http://stats.bls.gov/newsrels.htm).

News releases and other information are available from the BLS fax-on- demand service. To request a document fax, call (202) 691-6325. To request a catalog of available documents, select option 2 at the initial voice prompt. To request data found in this news release, enter the following codes: