ECI cumulative uarterly percent changes,
September 1975—December 1979

Occupational group

All workers
White-collar workers
Blue—collar workers
——- Service workers

“ Industrial category

All private nonfarm
Manufacturing _
~ Nonmanu facturing

Union status

1
t
1
1
H
t
H Vv
Union occupations — ! fot
wesc Non—union occupations H .
1
'
'
1
t
t
1
1 H
t
4 {
1 1
' 1
1 1 1
t 1 1
1 H 1
4 7
Regions H H ' WV
' t 1 32.3
Northeast H ! H 323
South i t H 33
North Central H ! ! 50.5
——— West I 1 It —
' t t
4 1 1
1 t
1 1
1 1
t
1
1

1975 1976 . 1977 1978 1979

LLiLII tity

LLLI Te rt i

LLILI Itt iy

LILLE tit t |


Rate of wage and salary changes in Employment Cost Index

(Percent changes)
Series 3 months ended 12 months ended
|
December March June | September | ‘December March June September | December
1978 1979 1979 1979 1979 1979 1979 1979 1979
All private nonfarm workers --~-~ 1S 2.0 1.9 21 2.4. 7.8 7.6 nT 8.7
Workers, by occupational group
White-collar workers -- mee 1.2 1.9 1.7 2.3 2.4 7.3 7.0 7.4 8.6
Professional and technical workers - 1.5 1.9 1.1 2.7 2.8 Ta 6.8 7.5 8.8
Managers and administrators 1.5 2.4 1.5 2.0 1.4 | 7.2 6.9 7.6 7.4
Sales workers ~ Oo. 70.2 4.2 0.7 3.9 7.9 6.7 4B 8.8
Clerical workers -- 1.3 2.7 14 2.9 2.1 7.4 7.4 8.5 9.4
Blue-collar workers --. 1.9 1.9 2.3 2.0 2.5 8.3 8.4 8.4 9.0
Craft and kindred workers 1.6 2 21 2.2 1.9 8.5 8.2 8.3 8.6
Operatives, except transport 2.3 1.9 2.2 1.7 3.1 7.8 8.6 8.3 9.2
Transport equipment operatives 1.7 1.5 3.5 2.4 2.4 9.3 8.3 9.5 10.2
Nonfarm laborers - 2.4 1.5 2.7 1.7 2.9 7.9 8.6 8.5 9.1
Service workers -- 0.6” 3.2 0.9 La 1.8 8.3 7.2 3.9 7.2
Manufacturing 27 1.7 1.8 1.8 3.1 8.0 8.2 8.1 8.6
Durables ~ 2.7 1.8 1.5 2.1 3.3 8.4 8.2 8.4 9.0
Nondurables. 2.5 1.5 2.3 1.2 2.7 7.4 8.2 7.6" 7.8
Nonmanufacturing 0.8 2.2 2.0 2.3 2.0 7.6 7.2 7.5 8.8
Construction 1d 1.3 2.6 2.0 1.1 7.9 7.6 7.2 7.2
Transportation and public
utilities ---. nae 1.9 2.6 1.6 2.9 2.0 8.9 8.4 9.2 9.4
Wholesale and retail trade -: LL 2.1 2.4 1.9 1.3 7.3 7.0 7.7 7.9
2.0 1.6 2.9 1.2 2.1 6.6 7.7 7.8 7.9
0.8 2.3 2.3 2.1 1.0 7.6 6.7 77 7.9
Finance, insurance, and .
real estate - * 3.1 3.2 1.9 4.3 * x * 13.2
+ Services ~ 0.7 2a 11 2.6 25 7.0 6. 6.6 8.5
Workers, by region
Northeast ------- 1.8, 1.5 17 1? 21 6.8 6.9 6.9 1.3
South =~ 1.6 2.6 1.7 17 2.4 8.8 8.3 2? 8.5
North Central 1.5 1.9 2.5 2.0 2.6 7.5 7.8 8.2 9.4
West ~--~ 15 2.0 2.0 2.5 1.8 19 17 8.2 8.5
Workers, by bargaining status
Union -~ na 2.0 1.8 2.1 2.2 2.6 B.2 8.3 8.4 9.0
Manufacturing 2.7 1.7 2.0 1.9 3.4 8.7 9.1 8.6 9.4
Nonmanufacturing 1.4 1.9 2.2 2.5 1.7 77 7.6 8.2 8.5
Nonunion ----~----. 1 2.1 1.9 1.9 2.3 7.5 7.2 7.3 8.5
Manufacturing ~ 2.6 1.7 1.7 1.6 2.7 7.3 7.4 7.7 7.9
Nonmanufacturing 0.5 2.3 2.0 2.1 2a 7.6 7.1 7 8.8
Workers, by area
Metropolitan areas 1.6 2.0 2.0 2.2 2.5 7.8 7.7 7.9 8.9
Other areas -~ 1.3 2.1 2.1 1.6 1.9 7.6 7.4 7.3 7.9

* Not available


United States
Department
of Labor

Bureau of Labor Statistics Washington, D.C. 20212

N

USDL: 80-115

Beth Levin (202) 523-1165 FOR RELEASE: Immediate
Kathryn Hoyle (202) 523-1913 Thursday, February 28, 1980

EMPLOYMENT COST INDEX-~December 1979

Wage and salary rates measured by the Employment Cost Index (ECI) rose 2.4 percent for the
3 months ended in December 1979, the Bureau of Labor Statistics of the U.S. Department of Labor
reported today. The increase was above the 1.5 percent advance for the same quarter in 1978.
For the 12 months ended in December 1979, the wage and salary rise was 8.7 percent. Because the
ECI is a relatively new statistical series, the data are not seasonally adjusted.

The Employment Cost Index currently measures changes in wages and salaries, defined as
straight-time average hourly earnings. The changes reflect negotiated settlements, changes
instituted by employers, cost-of-living adjustments, and other pay changes during the period
measured. With the inclusion of employee benefit costs later this year, the series will also
measure total compensation changes.

Septémber-December 1979

The overall 2.4 percent increase during the fourth quarter was largely the result of pay
gains for manufacturing workers, averaging 3.1 percent. Within manufacturing, the 3.3 percent
pay advance in durables principally reflected contract settlements in the automobile industry
that resulted in negotiated increases and cost~of-living adjustments for a large number of
workers. Pay gains for nonmanufacturing workers, as a whole, averaged 2.0 percent during the
quarter. Within nonmanufacturing, pay advances ranged from 1.0 percent for workers in retail
trade to 4.3 percent for those in finance, insurance, and.real estate. The 4.3 percent rise
largely reflects accelerated increases in commission earnings for stock and bond brokers.

Wages and salaries rose at about the same rate for both white-collar (2.4 percent) and
blue-collar (2.5 percent) workers in the September-December 1979 period. Within these catego-
ries, however, there was a wide range of increases among occupational groups. Pay gains for
white-collar groups ranged from 1.4 percent for. managers and administrators to 3.9 percent for
sales workers, Sales workers' pay tends to be volatile because it is heavily influenced by

commission earnings which fluctuate with the volume of sales. The ECI is computed from wage


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and salary rates, where available, or straight-time average hourly earnings for workers paid
under incentive or commission pay systems whose average hourly earnings are affected by fluctua-
tions in the volume of output and sales, as well as changes in the rate structure.

Blue-~collar Pay advances ranged from 1.9 percent for craft and kindred workers to 3.1 percent
for operatives (except transport). Service workers averaged an 1.8 percent advance. :

: Pay advances for union and nonunion workers were 2.6 and 2.3 percent, respectively, during
the quarter. Unionized workers in manufacturing showed a 3.4 percent increase in wages, compared
with 1.7 percent in nonmanufacturing. Corresponding advances for nonunion workers were 2.7 and

"2.1 percent. ,

Regionally, pay gains ranged from 1.8 percent for workers in the West to 2.6 percent for
those in the North Central States.
Decembier_1978-December 1979

The pay advance for the 12 months ending December 1979 was 8.7 percent for private nonfarm
workers. Pay in manufacturing was up 8.6 percent, nearly the same as the 8.8 percent rise in
nonmanufacturing. Among industry groups, however, pay gains ranged from 7.2 percent in construc-
4exon to 13.2 percent ‘in finance, insurance, and real estate~-a group largely influencea by fluc=
tuations in commission earnings for sales workers.

Pay advances for blue-collar.workers averaged 9.0 percent over the year, compared with 8.6
Percent for white-collar workers and 7.2 percent for service workers.

Average pay gains for workers covered by collective bargaining agreements amounted to 9.0
percent compared with 8.5 percent for nonunion workers. The differential over the 12-month
period was mainly due to wage increases in manufacturing where pay for union workers advanced
9.4 percent contrasted to 7.9 percent for nonunion workers.

During the year, workers in the North Central States recorded the highest regional pay

gain (9.4 percent) and workers in the Northeast registered the lowest advance (7.3 percent).


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Explanatory Note

As a measure of change in the price of labor, the Employment Cost Index (RCI)
estimates movements in the rate of compensation for standardized units of labor .
services. The ECI is not designed to measure changes in total labor costs or the level
of well-being of workers. :

The published data cover workers in the private nonfarm economy. The "union"
series includes those occupations covered by collective bargaining agreements. The
"nonunion" series includes occupations not so covered.

Each quarter, straight-time average hourly earnings are collected for some 9,000
occupations defined by 417 occupational categories that correspond closely to those
used in the 1970 Census. The establishments. in the private nonfarm economy that supply
these occupational data are placed in an industry group based on a two-digit Standard
Industrial Classification (SIC). Sample weights are applied to these occupational
earnings to calculate 4 weighted average for each occupation by industry.

By multiplying the SIC/occupation averages by base period employment weights from
the decennial census, a total wage bill for each of these cells is produced. After
summing the wage bills across cells for the various series, ratios obtained by dividing
current quarter by prigr quarter wage bills are used to derive quarterly percent
changes. ‘

The statistics are not annualized, nor are they adjusted for seasonal influences.
For example, the 2.4 percent change, shown in the table, for the "all private nonfarm
workers" series in the fourth quarter of 1979 is the actual percent change in
straight-time average hourly earnings from the pay period including the 12th day of the
survey month of September 1979 to the comparable pay period in December 1979. The
computation of percent changes spanning more than one survey period is accomplished by
compounding successive changes for individual quarters. The 39.1 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 December 1979.

The chapter on the Employment Cost Index in the BLS Handbook of Methods (BLS
Bulletin 1910) describes the survey design. A general description of the Employment

Cost Index is available upon request.