Employment Cost Up 0.7% in Q4

The fourth quarter’s rise was down from the 1.0% increase notched in the previous three month period (See  Employment Cost Continue to Rise in Q3 ).   For the year, employment costs rose 3.8%, up from a 3.4% gain in 2002, according to a release of data from the US Department of Labor (DoL).

Wall Street analysts polled by Reuters had been expecting a 0.9% rise in costs during the fourth quarter.

Broken out by individual components, benefits costs increased 1.2% and continued to outpace the 0.5% gain in wages and salaries for civilian workers.  Overall, employer costs for benefits account for over a third of compensation costs and include such items as health and other insurance, retirement plans, paid leave, and legally required benefits like Social Security.

The ECI is a component of the National Compensation Survey and measures changes in compensation costs, which include wages, salaries, and employer costs for employee benefits.