Comp Growth Slowed in Q105

May 5, 2005 ( - The growth in hourly compensation slowed a bit during the first quarter of 2005 over the previous quarter, the government announced.

According to the US Department of Labor’s Bureau of Labor Statistics (BLS), hourly compensation in the US business sector increased 4.3% during the January to March period in 2005 – down from a 4.9% hike in the previous quarter. This measure includes wages and salaries, supplements, employer contributions to employee benefit plans, and taxes.

Meanwhile, the hourly compensation of all manufacturing workers rose 4.9% during the first quarter, reflecting a hike of 5.3% in durable goods and 3.9% in nondurable goods, the government said. Because the hourly compensation of manufacturing workers rose more rapidly than output per hour, unit labor costs increased in the first quarter by 0.9 %. This is similar to the 0.8% increase recorded in the fourth quarter of 2004.

In durable goods manufacturing, however, unit labor costs fell in the first quarter of 2005 by 0.9%. All of the increase in manufacturing unit labor costs came from the nondurable goods subsector, where unit labor costs advanced by 2.6%.

Hourly compensation in the non-financial corporate sector advanced 4.4% in the fourth quarter of 2004, and real hourly compensation was up 0.8%. Unit labor costs fell 0.8% in the fourth quarter of 2004 – the first decline in these costs since the fourth quarter of 2003.