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10

1970 Census Category 1980 Census Category

Managers and administrators Executive, administrative; and
managerial occupations

Professional and technical Professional specialty and

workers technical occupations

Sales workers Sales occupations

Clerical workers Administrative support
occupations, including
clerical

Craft and kindred Precision production, craft,

workers and repair occupations

Operatives, except Machine operators, assemblers,

transport and inspectors

Transport equipment Transportation and material

operatives moving occupations

Nonfam laborers Handlers, equipment cleaners,

helpers, and laborers
Service workers Service occupations

Fixed employment weights are used each quarter to calculate the most aggregate
indexes--civilian, private, and State and local governments. ‘hese fixed weights
are also used to derive all of the industry and occupation series indexes.

For the series based on bargaining status, region, or area size, employment data
are not available from the Census. The employment weights are reallocated within
these series each quarter based on the current sample. The indexes for these
series, consequently, are not strictly comparable to those for the aggregate, in-
dustry, and occupation series. A fuller explanation of the calculation of index
numbers appears in an article, "Estimation procedures for the Employment Cost
Index," in the May 1982 issue of the Monthly Labor Review.

More detailed information on the HCI is available in several articles and publica-
tions. These include a chapter in the BLS Handbook of Methods (Bulletin 2134-1),
"The Employment Cost Index." Two articles also appeared in the Monthly Labor
Review: "Employment Cost Index: a measure of change in the 'price of labor',"
July 1975; and “How benefits will be incorporated into the Employment Cost Index,”
January 1978, Reprints of these articles plus several other descriptive pieces
and a historical listing of ECI data are available upon request.


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Saluvivs aNv S39VM


9

EXPLANATORY NOTE

The Employment Cost Index (ECI) is a measure of the change in the price of labor,
free fran the influence of employment shifts among occupations and industries.

The ECI wage and salary series is limited to changes in wage and salary rates,
defined as the hourly straight-time wage rate or, for workers not paid on an hourly
basis, earnings divided by the corresponding hours. Straight-time wage and salary
rates are total earnings before payroll deductions, excluding premium pay for over-
time and for work on weekends and holidays, and shift differentials. Production
bonuses, incentive earnings, commission payments, and cost-of-living adjustments
are included in straight-time wage and salary rates.

The compensation series includes employer costs for employee benefits as well as
wages and salaries. Benefits covered by the ECI are: Paid leave (vacations, holi-
days, sick leave, and other leave); supplemental pay (premium pay for overtime,
shift differentials, and nonproduction bonuses); insurance benefits (life, health,
and sickness and accident); retirement and savings benefits (pension and other re-
tirement plans and savings and thrift plans); legally required benefits (social
security, railroad retirement and supplemental retirement, railroad unemployment.
insurance, Federal and State unemployment insurance, workers' compensation, and
other legally required benefits such as State temporary disability); and other
benefits (severance pay, supplemental unemployment plans, and merchandise discounts
in department stores).

The ECI provides data for both the private and public sectors, which are published
separately and also combined as the total civilian economy. The private sector in-
cludes the total private economy, excluding farms and households. The public sector
covers State and local governments, but excludes the Federal government.

Each quarter, straight-time average hourly wage and salary rates and benefit cost
data (cents-per-hour-worked) are collected fran a probability sample of about
14,000 occupations within 2,500 sample establishments in private industry and about
3,500 occupations within 700 sample establishments in State and local governments.
Data are collected for the pay period including the 12th day of the survey months
of March, June, September, and December. CI statistics are neither annualized nor
adjusted for seasonal influences.

The sample establishments are classified in industry categories based on the 1972
Standard Industrial Classification (SIC), as defined by the U.S. Office of
Management and Budget.

Within an establishment, specific job categories are selected to represent broader
occupational definitions. Beginning with June 1986, the jobs are classified
according to definitions used in the 1980 Census. Prior to June 1986, they were
classified according to the 1970 Census. The titles of the published 1970 and
1980 occupation groups are listed below for camparison. Differences between the
two classification systems are slight, as indicated in the article "Introducing
new weights for the Employment Cost Index," in the June 1985 issue of the

Monthly Labor Review.


: 4

: United States
4 of Labor ;

- Bureau of Labor Statistics . Washington, D.C. 20212

Technical, historical contact: USDL: 86-312
(202) 523-1165
Media contact: (202) 523-1913 FOR RELEASE: 10:00 A.M. E.D.T.

Tuesday, July 29, 1986

EMPLOYMENT COST INDEX - JUNE 1986

The Employment Cost Index (ECI) increased 0.7 percent in the 3 months ended in
June 1986, the U.S. Department of Labor's Bureau of Labor Statistics reported
today. The March-June 1986 increase matched the 0.7 percent gain in the same
3-month period last year. For the year ended June 1986, the ECI rose 4.0 per-
cent--down from 4.6 percent a year ago. The HCI measures changes in compensa-
tion costs, which include wages, salaries, and employer costs for employee
benefits.

Wages and salaries alone rose 4.1 percent over the year ended June 1986. ‘The
increase was higher for State and local government workers (5.7 percent) than
for private industry workers (3.7 percent), who make up a great majority of
employees covered by the HCI.

June 1985-86 pay increases in private industry were higher for workers in
service-producing industries (4.1 percent) than for those in goods-producing
industries (3.3 percent). Among goods-producing industries, increases ranged
from 2.7 percent in construction to 4.3 percent in nondurable goods manufacturing.
Pay gains in service-producing industries ranged fran 2.5 percent in transporta-
tion to 5.2 percent in finance, insurance, and real estate, which was influenced
by commission earnings of sales workers. (See table 4.)

Over-the-year wage and salary increases in private industry were higher for
white-collar occupations (4.5 percent) than for blue-collar or service occupa-
tions (2.8 percent and 2.9 percent, respectively).

RRRERK AKER IRR ER ERR RERR AIA RIA RRR IIIT RII IIIT A I

* Beginning with this release, BCI measures are based on
fixed employment counts from the 1980 Census of Popula-
tion rather than fram the 1970 Census. The 1980 Census
occupational classification system specified new titles
for the occupational categories. See the explanatory
note for a comparison of the 1970 and 1980 titles.

ee ae

ECI estimates for the period March 1985 to March 1986
will be recalculated, using the 1980 Census weights. The
recalculations, which will be available in September
* 1986, will provide a one-year overlap for BCI estimates

* based on 1970 and 1980 Census weights.
RRR EER IKK IRR RIKER RRR ERIS RRR I TIRE III I IIIT IR IRI IAI I

*

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Pay increases for nonunion workers (4.1 percent) exceeded those of union workers
(2.5 percent) during the June 1985-86 period. ‘This relationship held in goods-
producing industries (3.9 percent compared with 2.3 percent), as well as in ser-
vice-producing industries (4.4 and 2.9 percent, respectively). (See table 6.)
Since the year which ended in December 1983, over-the-year pay gains for nonunion
workers have consistently outpaced those of union workers.

The June 1986 ECI: level stood at 131.5 for compensation costs, based on June
1981=100. Compensation cost increases over the 5-year period (June 1981-86) were
39.7 percent for State and local government workers, campared with 29.9 percent
for private industry workers. Increases in private industry were larger for white-
collar (32.5 percent) than for blue-collar (26.3 percent)-occupations; larger for
workers in service-producing (31.6 percent) than goods-producing (27.8 percent)
industries; and larger for nonunion (30.2 percent) than for union (28.7 percent)
workers. .

. ‘The ECI covers private industry workers (excluding farms and households) and State
and local government workers. It is not seasonally adjusted.

ECI data for September 1986 will be released on Tuesday,:. October 28, 1986,
at 10:00 a.m. E,S.T.