Wages Rise at 2.6 Percent in 2017 Despite Q4 Slowdown
month pace since the spring of 2015 . The 12 - month gain in wages and benefits came despite a slight slowdown at the end of last year with wages and benefits rising 0 . 6 percent in the fourth quarter   a tiny dip from a 0 . 7 percent gain in the third quarter   the Labor Department reported Wednesday . Still   the 12 - month gain was an improvement from a 2 . 2 percent gain for the 12 months ending in December 2016 . In his State of the Union address Tuesday night    President Donald Trump  touted the rise in wages as an accomplishment of  his  economic program . But private economists contend that wages should be rising at a faster pace given that unemployment is now at a 17 - year low of 4 . 1 percent . The gain in the employment cost index showed that wages and salaries were up 2 . 5 percent for the 12 months ending in December while benefits such as employer contributions to health insurance and pension plans rose 2 . 5 percent . Wages and salaries make up about 70 percent of compensation costs while benefits make up the other 30 percent . Most economists believe that wages should be increasing at a faster pace given the drop in the jobless rate to 4 . 1 percent . The last time unemployment was this low   in the late 1990s   average hourly pay   another measure of wages   was rising at a 4 percent pace . Hourly wages rose 2 . 5 percent in 2017   down from a 2016 gain of 2 . 9 percent   according to a separate Labor Department report . The employment cost index   which tracks wages and compensation benefits   last rose faster than 2 . 6 percent over a 12 - month period in September 2008 when the gain was 2 . 9 percent .
month pace since the spring of 2015 . The 12 - month gain in wages and benefits came despite a slight slowdown at the end of last year with wages and benefits rising 0 . 6 percent in the fourth quarter   a tiny dip from a 0 . 7 percent gain in the third quarter   the Labor Department reported Wednesday . Still   the 12 - month gain was an improvement from a 2 . 2 percent gain for the 12 months ending in December 2016 . In his State of the Union address Tuesday night    [TGT]touted the rise in wages as an accomplishment of  [TGT]  economic program . But private economists contend that wages should be rising at a faster pace given that unemployment is now at a 17 - year low of 4 . 1 percent . The gain in the employment cost index showed that wages and salaries were up 2 . 5 percent for the 12 months ending in December while benefits such as employer contributions to health insurance and pension plans rose 2 . 5 percent . Wages and salaries make up about 70 percent of compensation costs while benefits make up the other 30 percent . Most economists believe that wages should be increasing at a faster pace given the drop in the jobless rate to 4 . 1 percent . The last time unemployment was this low   in the late 1990s   average hourly pay   another measure of wages   was rising at a 4 percent pace . Hourly wages rose 2 . 5 percent in 2017   down from a 2016 gain of 2 . 9 percent   according to a separate Labor Department report . The employment cost index   which tracks wages and compensation benefits   last rose faster than 2 . 6 percent over a 12 - month period in September 2008 when the gain was 2 . 9 percent .