The biggest rise in benefits in more than two years helped push total US employment costs up at a slightly faster pace during the second quarter, though wage and salary gains moderated, a Labour Department report on Tuesday showed.
The department's Employment Cost Index, a broad gauge of what employers pay in wages, salaries and benefits, rose 0.9 percent during the April-June second quarter. That was in line with Wall Street economists' forecasts and ahead of the first quarter's 0.8 percent increase.
Wages and salaries rose 0.8 percent during the second quarter, down from the 1.1 percent gain posted during the first quarter. But benefit costs jumped by 1.3 percent after barely edging up by 0.1 percent in the first quarter. Department officials said the rise in second-quarter benefit costs was the largest since 1.7 percent in the first quarter of 2005.
In the 12 months through June, employment costs were up 3.3 percent, moderately lower than the 3.5 percent increase in the 12-month period that ended in March. That may offer some reassurance to Federal Reserve policy-makers that employment costs - a key factor in assessing inflation risks - are moderating or at least not gaining so rapidly that the US central bank would need to raise official interest rates to dampen cost pressures.
In the 12 months through June, wages and salaries rose 3.4 percent, as did benefit costs. Wages and salaries account for about 70 percent of total compensation costs that employers pay and are closely monitored by policy-makers and economists.
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