WASHINGTON - The Employment Cost Index rose 0.7% for the second quarter 2011on a seasonally adjusted basis, the Bureau of Labor Statistics reported Friday. The first quarter ECI was unrevised at a 0.6% increase.
Wages and salaries, which account for about 70% of compensation, rose 0.4%, but benefits, about 30% of the cost, rose 1.3%, pushing up the overall number. First quarter wages were unrevised at a 0.4% rise and benefits revised up to 1.3% increase.
Economists polled by Thomson Reuters predicted a 0.5% increase.
Only private sector workers saw wages and salaries increase in the second quarter, rising a tenth of a percent.
Private sector employment costs rose 0.8% overall. Wages and salaries increased 0.5%, but the cost of benefits showed a 1.6% rise.
For state and local government workers, overall compensation rose 0.4%, down from 0.5% in the first quarter. The increase in wages and salaries was 0.4% in both quarters. Benefits fell to 0.5% in the second quarter from 0.9% in the first.
Economists at IHS Global said before the report that "in the public cost cutting is putting downward pressure on wages" and "in the private sector labor costs remain contained because of slack"
Year-over-year total compensation rose at a 2.2% annual rate, up from a 2.0% rate in the first quarter.
