“5+

premium payments for overtime and for work on weekends and holidays and shift
differentials. Production 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, September, and December.

The Index occupations conforia to the Bureau of the Census occupational
classification system, which consists of 441 occupations, grouped into 12 broad
occupational categories. Respondents in the quarterly surveys are establishments or
groups of establishments comprising a reporting unit.

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 occupational 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 new
series, average pay levels have been computed for the overall and component published
series for September 1975, and these are available upon request,

In addition to the occupational groups and industries shown in the table,
published statistics cover sales workers, mining,and finance, insurance, and real
estate, but insufficient data preclude separate publication of these results, The
industries for which second quarter statistics are published comprise over 90 percent
of the total sample. The relative importance of the industrial and other component
submeasures, as of September 1975, and estimates of relative sampling errors are

also available on request.


-4-

Description of Employment Cost Index .

The Employment Cost Index is designed to measure changes in the rate of com-
pensation 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. It is not intended as a measure of the total cost of employing
Labor, nor as a measure of the Level of well-being of workers.

The scope of the measure will be expanded gradually to include outlays for
employee benefits and to broaden industrial coverage, resulting in an index of changes
in all compensation--wages and salaries plus benefits--covering the total civilian
economy. Publication of benefit data is expected to begin in the fall of 1977. There
also will be increases in the amount of industry, occupation, and area detail released
and in 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 occupational wage
and salary data collected quarterly from approximately 2,000 respondents representing,
with certain exclusions, the occupational employment composition of the private non-
farm economy. 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.

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. Straight-time earnings are total earnings before deductions, excluding


The regional coverage is as follows: Northeast--Connecticut, Maine, Massa-—
chusetts, 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; and West--Arizona, California, Colorado, Idaho, Montana,
Nevada, New Mexico, Oregon, Utah, Washington, and Wyoming.

Future releases are tentatively scheduled for November, February, May, and

August--2 months after each quarter.


>

United States
Department
of Labor

Office of Information Washington, D.C. 20210

BUREAU OF LABOR STATISTICS USDL-76-1172

A, Sackley , (202) 523-1165 FOR RELEASE: 11:00 A.M. (EDT)

K. D, Hoyle (202) 523-1913 Tuesday, August 31, 1976
Home: 333-1384

EMPLOYMENT COST INDEX--June 1976

Wage and salary rates measured by. the Employment Cost Index rose 1.7 percent
from March to June, it was reported today by the Bureau of Labor Statistics of the U.S.
Department of Labor. This increase was down from the 1.9 percent reported for the
first 3 months of tne year. Since September 1975, when initial data for the
Employment Cost Index were collected, wage and salary rates have gone up 5.5 percent.

( See table.)

The different rates of increase for the subgroups noted below are due not only
to the size of increases received but also to the relative number of workers
receiving increases. For example, the 4,5 percent pay increase for transport
equipment operatives was influenced by the large employee coverage of negotiated
settlements in trucking during the second quarter, as well as the amount of pay
gains received by these workers. Accelerated increases in pay were reported also for
service and managerial occupations--up 3.3 and 2.1 percent, respectively. Rates of
increase in wage and salary rates for professional and technical workers and nonfarm
laborers continued the downward trend of the first quarter.

Wage rates of operatives, except transport, climbed at a much slower pace in
the second quarter--up only 0,8 percent, following the 2.8 percent rise in the first
quarter, Similarly, the rate of increase in salaries of clerical workers fell to
1.3 percent, after rising 2.2 percent in the first quarter.

With respect to industries, the rate of increase in pay for workers in

manufacturing declined for the second consecutive quarter to 1.5 percent.



-2-

Pay for employees in trade and services advanced at the same rate in the first and
second quarters. The largest industry pay gains were reported in construction,

3.1 percent, and in transportation and utilities, 2.8 percent. The relatively large
increase for construction workers was due in part to seasonal collective bargaining
patterns in the industry.

Among regions, wage rate gains continued to be higher in the West, despite a
slowing of the rate of increase from 3.3 percent in the first quarter to 2.3 percent
in the second. The rate of increase was also down in the South to 1.3 percent, On
the other hand, a pay gain of 1.4 percent was reported in the Northeast, up from
9.9 percent in the first quarter.

Pay of workers in occupations covered by collective bargaining agreements
advanced 1.8 percent in the second quarter compared with 1.6 percent for other workers,
reversing the pattern of. the prior quarter.

Wage and salary rate gains for workers employed in metropolitan areas slowed
to 1.5 percent in the second quarter, down from 1.9 percent in the first quarter and
a slower rate of advance than for workers outside of metropolitan areas for the second
consecutive quarter.

Over the 3 quarters since September 1975, increases in pay tates have been
less in the overall measure of change than in the component series covering blue-
collar and service workers; workers in transportation and public utilities, and trade;
workers in the West; workers in unionized occupations; and workers employed outside

of metropolitan areas.

|
|
:



Rate of wage and salary changes in Employment Cost Index,
September 1975 through June 1976

(In percent)

Fourth First Second Three quarters
Series quarter quarter quarter ending in
1975 1976 1976 June 1976

All private nonfarm workerS ....sseeee 1.8 1.9 1.7 5.5
Workers, by occupational SEoup
Professional, technical, an
kindred workers ....sseseeceeeees
Managers and administrators, except
farm ..... decane reer crew ec eeeee
Clerical and kindred workers
Craft and kindred workers .
Operatives, except transport .....
Transport equipment operatives .
Laborers, except farm ....sseeeeeee
Service workers, except private
household .....-...

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BO ONENEPNE
2 ANNONA
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Workers, by industry division
Construction ........5.6. seeeee
Manufacturing ... 2.1
Transportation and public utilities 2.6

1.8
1.8

Wholesale and retail trade ........
S@rviceS .- cee se essence e ne ceeeeoee .

Workers, by region
Northeast

South ...
North Central
West .-.eeeeee

Workers, by bargaining status
Occupations covered by collective
bargaining agreements ....s.-.ee05 2.4 1.6 1.8 6.0
Occupations not covered by collec-
tive bargaining agreements ...... 1.6 2.0 1.6 5.4

Workers, by ova
Metropolitan a
Other areas

9
-6

BR

Explanatory Note

The statistics are percent changes in straight-time average hourly earnings
over the period indicated. For example, the 1.7 percent change for the
"all private nonfarm workers" series in the second quarter 1976 is the
actual percent change in straight-time average hourly earnings from the pay
period including the 12th of the survey month of March"the comparable
period in June. The statistics are not annualized, nor are they adjusted
for seasonal influences.

The computation of percent changes spanning more than one survey period is
accor iished by compounding successive changes for individual quarters.
n a tual practice, the compounding calculations are made to the fifth
decimal place.

Dashes in the table indicate that the data collected were insufficient to
meet statistical criteria for publication during the periods indicated.