Story developing. Check back for updates.
The numbers: A measure of what it costs businesses to employ workers rose a sharp 1.1% in the third quarter, keeping upward pressure on U.S. inflation.
Economists polled by The Wall Street Journal had forecast a 1.0% increase in the so-called employment cost index.
The cost of labor has risen by 1% or more for nine quarters in a row stretching back to the middle of 2021.
Before that, the last time compensation rose at least 1% a quarter was in 2006.
The increase in compensation in the past 12 months, however, slowed again to 4.1% from 4.2%. And it’s down from a 34-year peak of 5.1% in 2022.
Yet that’s still well above the average 2.7% increase in wages and benefits from 2017 to 2019, toward the tail end of an era of low inflation.
The Federal Reserve wants to see compensation growth return to pre-pandemic levels as part of its effort to get inflation under control, but workers still have lots of leverage because of the tightest labor market in decades.
Major unions have showed off their newfound power by winning more generous contracts in Hollywood and and the auto industry, among others.
Market reaction: The Dow Jones Industrial Average
DJIA,
and S&P 500
SPX,
were set to open higher in Tuesday trades.
Read the full article here
