The Employment Cost Index (ECI) measures wage and salary changes by comparing average rates for the same jobs over three-month intervals. Jobs with declining employment show higher wage growth, while those with increases exhibit slower growth. This offsets to create overall wage growth similar to jobs with stable employment. From 2006-2019, employment changes consistently influenced wage trends, but patterns shifted during 2020-2022, particularly during the COVID-19 pandemic. Jobs with no employment change saw 12-month wage growth of 1.4% in December 2020, compared to 2.8% overall. The ECI’s methodology uses a Laspeyres index, maintaining fixed job samples despite workforce changes, which can affect wage growth rates. These variations highlight the index’s sensitivity to labor market dynamics.
Source: Bureau of Labor Statistics (BLS).
Materials reproduced from www.bls.gov.
No endorsement by BLS is implied.
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