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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 employées 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 occupa~
tional wage and salary data are collected as, or converted into,
straight-time hourly earnings for the survey occupations. Straight-time
earnings are total earnings before deductions, excluding premium payments
for overtime and for work on weekends and holidays and shift differen-
tials. Prceduction bonuses and 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, Septemper, 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

and responsibility of a given activity. Top and middle management,


pal,

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 corre-
spond 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, and these are availaple upon
request.

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 1976, and estimates of relative
sampling errors 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, Soutn Carolina, Tennessee,
Texas, Virginia, and West Virginia; North Central--Illinois, Indiana,
Iewa, Kansas, Michigan, Minnesota, Missouri, Nebraska, North Dakota,
Ohio, South Dakota, and Wisconsin; West-~Arizona, California, Colorado,
Idaho, Montana, Nevada, New Mexico, Oregon, Utah, Washington, and

Wyoming.


pe

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
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. Publication of compensation statistics including
employee benefits is scheduled to begin in 1979, followed by statistics
for the total civilian economy in subsequent years. 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

9,000 occupational wage and salary observations collected quarterly

from approximately 2,000 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. Establish-
ments of all sizes are within the scope of tne survey. The major

exclusions are the self-employed, unpaid family workers, private


odes

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. 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.

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.


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 12-month period ended in that quarter. The
Employment Cost Index statistical series, from September 1975, is

availaple in Current Wage Developments, a BLS monthly periodical.


United’ States
News =" 6
of Labor

£
Bureau of Labor Statistics Washington, D.C. 20212
A. Sackley (202) 523-1165 . USDL-77-1029
K. D. Hoyle (202) 523-1913 For Release: 11:00 A. M. (EST)
Home: 333-1384 November 30, 1977
EMPLOYMENT COST INDEX~-September 1977
Wage and salary rates measured by the Employment Cost Index rose
1.8 percent for the 3 months ended in September 1977, the Bureau of
Labor Statistics of the U.S. Department of Labor reported today. In
the 12 months ended in September 1977, wage and salary rates rose 7.2
percent. (See table.)
a
. June_1977-September 1977
e

The rate of pay in the manufacturing industry which has the most
influence on the overall index, rose from 1.8 to 2.2 percent between
the second and third quarters. This rise was offset, however, in the
overall index by smaller increases in other industries. The smallest
increase was in wholesale and retail trade which experienced the
smallest rise comrared witn other industries in both of the last
2 quarters. In construction, the quarter~to-quarter slowdown in the
rate of increase, from 2.3 to 1.8 percent, was largely a slack-off
from the traditional seasonal increases in the spring. In transporta-
tion and public utilities, the dip in the rate of increase, from 2.9
to 2.0 percent in the third quarter, reflected fewer deferred negotiated
increases and cost-of-living adjustments compared with the preceding

quarter.


Service workers

This group includes those who maintain law and order, 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 fignters. Private housenold 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 occupa-
tional averages, by industry, using weights essentially derived from a
1974 occupational employment survey. These industry pay averages are

aggregated for index computation using fixed weights obtained from the


cole

-2-

Among occupations, craft workers experienced an accelerated rise in
wages over the quarter, up 2.2 percent from 1.9 percent in tne preceding
quarter. On the other hand, percentage pay gains were smaller than in
the preceding quarter for mast blue-collar and service workers. The
slowdown was most pronounced for laborers and equipment operatives.

Among white-collar employees, percentage Pay gains were highest for
clerical workers and lowest for managers, a reversal of their relative
standings in tne preceding quarter.

Pay of workers in occupations covered by collective bargaining
agreements advanced 1.9 percent in the third quarter, compared with 1.7
percent for workers not covered. Pay for workers in metropolitan areas
climbed at a slower rate in the third than in the second quarter; out-
side of metropolitan areas, the rate of advance was higher than in metro-
politan areas for the third consecutive quarter.

September 1976-September 1977

Over the 12 months since September 1976, increases in the rates of
pay for all the occupational groups in the blue-collar category and for
service workers exceeded the rate of increase for any of tne white-
collar groups. In this time span, increases in the rates of pay for
workers in transportation and public utilities and in manufacturing have
have been well above the national average, while increases for employees
in services and construction have been well below the average.

Pay gains for workers in occupations covered py collective bar-
gaining agreements continued to outpace increases for other workers in

the 4 quarters ended in September 1977.


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