Rate of wage and salary changes ia Smployment Cost Index

TPercant changes) 7
3 months ended 12 months ended
Series
Tune” |~September , Decenber | March | June || Septenber | Decenber | March] June
1977 197 1977 1978 | 1978 1977 197 1978 | 1978
ALL private nonfarm workers s.sesseeeeeseeeees Le FB 1.7 Lg 21 7.2 7000 | 75 7.8
Workers, by occupational group
White-collar workers sessseeseseeeeeeeeers | a6 M7 1.8 1.8 Qa 6.6 6.5 ra
Professional and technical
WOFKETS seseeeseceeeeceeseeeseeeserees | 165 1.8 17 1.6 13 6.8 6.7 | 6.8
Managers and administrators ssssseseseee 2.0 | 13 0.7 2.4 1.8 6.5 i 6.2 | 6.5
Sales Workers ..seseseeeees seeee [LT 7 4.0 0.3 5.4 * * | ng
Clerical workers ...... teeeeeeeee | LZ 2.0 7 204 14 6.5 69 5 7S
Blue-col lar Workers sesseseeeeeseesserrsee | 2e2 1.3 1.8 1.3 22 7.8 a7 | one
Craft and kindred workers .... 1.9 2.2 7 1.3 23 7.8 a2 1 71a
Operatives, except transport eeseseeeee | 17 1.6 2.2 25 Ls 1.9 13 | 8.2
Transport equipment operatives . 42 16 oo) 13 45 7.2 na) a4
Nonfarm laborers ... 209 1.3 ws |e 2a 8.5 fone | sa
H H H
Service Workers s.ssseveeee 2.2 7 1.0 1 3.6 Lg 75 | Om | 8.7
Workers, by industry division |
Manufacturing sesseeseeeseseees 8 2.2 2.0 1.6 8.2 | 718 8.0
Durables esseeeeeeeeeeeeeeeeees DLs 2.2 1.8 7 8.4 7.8 7.8
Nondurables sesssseseeeeeseceees j 22 2.0 23 1s 7.8 7.9 8.3
Nonmanufactur ing states ao) 1.5 ioe 2.4 6.6 6.5 | 7.2
Construction seeseseseseeeees 203 1.8 hou 2.9 6.2 6.6 | 6.9
Transportation and pi uti 1 2.9 2.0 14 2 05 9.200 | 87
Wholesale and retail trade ... spr 0.9 Ba 27 7.0 6.6 | 7.4
Wholesale trade seseeeeeeseces : * 0.2 2S 1.8 * * jos
Retail trades... seeeeee . 19 14 343 3 6.2, 5.8 | 78
Services veeseeeccscccsceceeeeee : fous er) 7 ur 5.2 5.3 611
Workers, by region i H
i |
Northeast sss. | 2.0 1? Ls 1.8 1.6 6.7 6.5 7.2
South sees. 2.2 19 1.2 3.0 2.2 7.0 | 69 8.5
North Genteal Ls 2.0 24 13 203 7.0 6.8 1
West seseeereeeee nN? 1s 18 i) 2.2 m7 Lo 7
: i
Workers, by bargaining status | i i
UNLON seseseeeeeneeeecusene sevsscsese f 262 Lg 2.0 1.6 2.0 wT ; 76 | 78
Manufacturing . tettitecesssseeens | 220 23 2.2 7 u7 8.8 io a3 | Bly
Nonmanufacturing s.scsesssseececeseeeese | 204 Ls 1.8 1s 23 6.6 7.0 7.2
Nonunton ...+. . seeeeeeeee | LT 17 1.6 2.2 2.2 6.9 6.6 13
Manufacturing seeseeeses 16 2.0 Ls 2.2 16 7.6 14 76
Nonmanufacturing seesees "ou? 1.6 1.6 21 25 6.4 6.2 | 762
i
Workers, by area H H |
Metropolitan areas Pause i oar 1.9 7 21 | 20 6.9 7.2
Other areas .. re Ll 3.4 23] 74 | 67 8.6

* Not available


-10-

In addition to the industries shown in the table, published statistics cover mining and
finance, insurance, and real estate, but insufficient data preclude separate publication of these
results. Series for which statistics are published comprise over 90 percent of the total sample,
The relative importance of the industrial and other component submeasures, as of December 1977,
and estimates of relative sampling error are also available on request.

The regional coverage is as follows: Northeast~-Connecticut, Maine, Massachusetts,

New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont; South~-Alabama,
Arkansas, Delaware, District of Columbia, Florida, Georgia, Kentucky, Louisiana, Maryland,
Mississippi, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia, and

West Virginia; North Central--Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Missouri,
Nebraska, North Dakota, Ohio, South Dakota, and Wisconsin; West--Arizona, California, Colorado,
Tdaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming.

A description of the survey design is provided in the chapter on the Employment Cost Index
in the BLS Handbook of Methods, BLS Bulletin 1910.

Releases are scheduled for February, May, August, and November-~2 months after each quarter,
Statistics in these releases pertain to the preceding quarter and the 12-month period ended in

that quarter. The Employment Cost Index statistical series, from September 1975, is available in

Current Wage Developments, a BLS monthly periodical.


Description of Employment Cost Index

The Employment Cost Index is designed to measure changes in the rate of compensation of a
standardized mix of labor services, much like the fixed weight market basket of the Consumer
Price Index. The Employment Cost Index is a measure of change in the price of labor, not of the
level of well-being of workers.

The scope of the measure will be expanded to total compensation, covering employee benefits
as well as wages and salaries, and to broader industrial coverage, resulting in an index of
changes in all compensation. Benefit data are currently being collected, edited, and stored pend-
ing completion of the computer Processing system which is scheduled to be operational in 1980.

A historical series based upon these data will then be provided in addition to current statistics,
A long-term program objective is to increase the amount of detail for industries, occupations,
and areas and the frequency of publication. Seasonally adjusted statistics will become available
as soon as sufficient experience is accumulated to compute adjustment factors,

The Employment Cost Index statistics are now computed from over 9,600 occupational wage
and salary observations collected quarterly from approximately 2,100 respondents representing,
with certain exclusions, the occupational employment composition of the private nonfarm economy.
Each observation may cover from 1 to several thousand workers, Data are collected covering
nearly a half million employees. Respondents in the quarterly survey are establishments or
groups of establishments comprising a reporting unit. Establishments of all sizes are within
the scope of the survey. The major exclusions are the self-employed, unpaid family workers,
private household employees, and workers in Alaska and Hawaii. Except for the.self-employed and
unpaid family workers, these exclusions are temporary, It is intended that agricultural
employees will also eventually be within the scope of the survey,

Straight-time hourly earnings are used in the Employment Cost Index as a proxy for a
measure of wage and salary rates. All occupational wage and salary data are collected as, or
converted into, straight-time hourly earnings for the survey occupations, As a result, fluctua~
tions in commission earnings—-commission rates remaining unchanged-~influence the Index.
Straight-time earnings are total earnings before deductions, excluding premium payments for

overtime and for work on weekends and holidays and shift differentials. Production bonuses and


ECI cumulative quarterly percent changes,
September 1975—June 1978

Occupational gr oup

All workers

White-collar workers
” Blue—collar workers
——- Service workers

Industrial ca tegor y

All private nonfarm
+ Manufacturing
~» Nonmanu fac turing

Union status

Union occupations .
wen--: Non-union occupations

Regions

Northeast

South

North Central
lest

PERCENT
4 3

20
ais
— 10

43

7 3
— 20
a 15
— 10

a3
+ 30
7 2
— 20
7 15
7 10

435
— 30
4 2
— 20
715
— 10



Transport equipment operatives

Truck, bus, and taxi drivers fall within this group.
Nonfarm laborers

Laborers move, lift, and carry materials and tools in work-places. These include freight
and material handlers, longshore workers, and construction laborers.
Service workers

This group includes those who maintain law and order and serve individuals in institutional,
commercial, and other establishments. Some of the occupations are janitors, bartenders, waiters,
dental assistants, practical nurses, flight attendants, barbers, and police and fire fighters,
Private household workers are excluded.

A complete listing of ECI occupations may be found in the "Employment Cost Index-~Occupation
Classification System Manual," Bureau of Labor Statistics, January 1975,

The published industry and occupational statistics do not pertain to mutually exclusive
groups of employees. Workers from all industry divisions may be represented in a major occupational
group; conversely, workers from all occupational groups may be represented in a major industry
division, For example, statistics for the industry "Services" are based on occupational pay data
for professionals, managers, clerical workers, service workers, etc. Similarly, statistics for the
occupational group "Service workers" cover such workers as janitors, waiters, practical nurses,
flight attendants, and guards; these may be found in real estate, retail trade, transportation, and
other industries as well as services,

The Employment Cost Index statistics, although computed from levels of occupational pay,
are measures of change. The pay level data collected from sample reporting units are weighted
into occupational averages, by industry, using weights essentially derived from a 1974 occupa~
tional employment survey, These industry pay averages are- aggregated for index computation
using fixed weights obtained from the 1970 decennial census. Average pay levels for the overall
measure and its components are not explicitly calculated as part of the computational process.
Although pay levels can be obtained by dividing the wage and salary aggregates by the fixed index
weights, these data do not correspond to actual average pay levels at any point in time. However,
because of interest expressed in the statistical design of this series, average pay levels have
been computed for the overall and component published series for September 1975, These levels are

available upon request.


. United States ;
Department &
of Labor

Bureau of Labor Statistics Washington, D.C. 20212

USDL: 78-746

D. Kohler (202) 523-1165 FOR RELEASE: 10:00 A.M. E.D.T.
K, D. Hoyle (202) 523-1913 Wednesday, August 30, 1978
Home: 333-1384 .

EMPLOYMENT COST INDEX--JUNE 1978

Wage and salary rates measured by the Employment Cost Index (ECI) rose 2.1 percent in the
3 months ended in June, the Bureau of Labor Statistics of the U.S. Department of Labor reported
today, This increase--up from 1.9 percent in the first quarter--included pay gains for workers
in construction and transportation as well as substantial increases in commission earnings
for stock and bond brokers and automobile salesworkers. In the 12 months ended in June, the
increase was 7.8 percent. (See table.) Since September 1975, when this series began, wages
and salaries have climbed 21.6 percent. (See chart.)

March 1978-June 1978

The 2.9 percent increase in construction, up from 1.2 percent in the first quarter,
reflected the seasonal pattern of collective bargaining in the industry with settlements and
deferred increases concentrated in the spring and summer months. In transportation and public
utilities, wage and salary rates rose 2.1 percent; a large number of workers in this industry
group were truckdrivers who received deferred increases and cost-of-living adjustments. The
rate of pay increase in manufacturing was less than that in nonmanufacturing industries combined
(1.6 and 2.4 percent, respectively), a reversal of what occurred in the first quarter (2.0 and
1.9 percent, respectively). Deceleration in the second quarter rate of increase for manufactur-
ing resulted from smaller pay gains for nonunion manufacturing workers (1.6 percent) than in the
preceding quarter (2.2 percent), while the rate of increase for workers covered by collective
bargaining agreements held steady for the 2 quarters (1.7 percent). The second quarter rate of
wage and salary increase for workers in wholesale and retail trade was 2.7 percent--down from the
first quarter despite a substantial rise in the commission earnings of salesworkers in retail

trade.


-8-

cost-of-living allowances are included in straight-time earnings. Data pertain to the pay period

including the 12th of the survey months of March, June, September, and December.

The Index occupations conform to the Bureau of Census occupational classification system

which consists of 441 occupations grouped into 12 broad occupational categories. Nine of these
groups are now in the scope of the survey. These major occupational groups are:

Professional and technical workers

These occupations are concerned with the theoretical or practical aspects of such fields
as art, science, engineering, education, medicine, law, and business relations. Included are
such highly trained personnel as teachers, dentists, accountants, attorneys, chemists, engineers,
physicians, and the clergy. Computer specialists, political scientists, writers, artists, and
entertainers are also in this category.

Managers and administrators

This group includes those positions charged with the direction of and responsibility for a
given activity. Top and middle management, and all other supervisory personnel above first-line
supervisory level, are included.

Sales workers

These workers include sales clerks as well as insurance and real estate agents, stock and
bond sales agents, and manufacturing sales representatives.
Clerical workers

Within this category are workers who type, operate computer and office machines, keep
records, take dictation, and deliver mail.
Craft and kindred workers

Work activities in this group primarily involve fabricating, processing, inspecting, or
repairing material, products, or structural units. Included are a variety of occupations such as
carpenters, tool and die makers, instrument makers, jewelers, electricians, and type-setters, An

apprenticeship is usually a prerequisite for entry into these occupations.

Operatives, except transport

Operatives in this grouping are engaged in such activities as assembling goods in factories,
operating or tending machinery, and photographic processing. Occupations such as solderers,

‘ welders, meat cutters, and gas station attendants are also included.


Explanatory Note

Statistics presented in the following table and chart are percent changes in straight-time
average hourly earnings over the period indicated. The statistics are not annualized, nor are
they adjusted for seasonal influences. For example, the 2.1 percent change, shown in the table,
for the "all private nonfarm workers" series in the second quarter of 1978 is the actual percent
change in straight-time average hourly earnings from the pay period including the 12th day of the
survey nonth of March 1978 to the comparable pay period in June 1978. The 22.6 percent change,
shown in the chart, for the "manufacturing" series is the cumulative quarterly percent change in
straight-time average hourly earnings from the pay period including the 12th day of the survey
month of September 1975 to the comparable pay period in June 1978. The computation of percent
changes spanning more than one survey period is accomplished by compounding successive changes
for individual quarters. In actual practice, the compounding calculations are made to the
fifth decimal place.

The "union" series includes those occupations covered hy collective bargaining agreements.

The "nonunion" series includes occupations not covered.


nonunion than union workers, Without the impact of the change in commission earnings, however,
the two series would have increased at about the same rate. Wage and salary gains were

highest for workers in the South and smallest for workers in the Northeast.


Salesworkers led all occupations in the rate of pay increase (5.4 percent), largely due
to a jump in commission earnings of stock and bond brokers and salesworkers in automobile dealer-
ships. The salesworker group, whose pay is heavily influenced by commission earnings which
fluctuate with the volume of sales, tends to be the most volatile of the ECI occupational series.
The ECL is computed from wage and salary rates, where available, or straight-time average hourly
earnings for workers paid under incentive or commission pay systems. The average hourly .earn-
ings are affected by fluctuations in the volume of output and sales, as well as changes in the
rate structure. (See attached description.) ,

Rates of increase for white- and blue-collar workers were about the same in the second
quarter (2.1 and 2.2 percent, respectively), both up from 1.8 percent in the prior period. Three
of the four white-collar groups experienced smaller rates of wage and salary increase, but this
was offset for the group as a whole by the sharp rise in salesworker pay. In the blue-collar
category, the rate of wage and salary increase for craft workers and transport equipment opera~
tives was up from the first quarter, while laborers and operatives, except transport, experienced
declining rates of increase. The pay of transport equipment operatives climbed 4.5 percent. As
mentioned previously, large numbers of these workers in trucking received deferred increases and
cost-of-living adjustments. The acceleration in the rate of increase for craft workers was spread
throughout most industries. On the other hand, laborers in wholesale and retail trade experienced
a slackening in the rate of pay increase which dampened the rate of increase for all laborers.
Wage and salary gains for service workers (1.9 percent) were smaller than in the first quarter
(3.6 percent).

For the second consecutive quarter, pay for nonunion workers (2.2 percent) advanced at a
faster rate than pay for union workers (2.0 percent). Large increases in commission earnings
paid to salesworkers helped push the rate of increase for the nonunion series above that for
the union, Workers in the North Central region recorded the largest gains, 2.3 percent, while
workers in the Northeast had the smallest, 1.6 percent.

June_1977-June_1978

Over the 12 months ended in June 1978, service workers’ pay increases outpaced those for

both white- and blue-collar workers, and wages and salaries increased by the same rate for workers

in both manufacturing and nonmanufacturing industries. Pay rates increased more rapidly for