Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: WEDNESDAY, January 27, 1993 TAG: 9301270076
SECTION: BUSINESS PAGE: A7 EDITION: METRO
SOURCE: Associated Press
DATELINE: WASHINGTON LENGTH: Medium
INCOME OUTRUNS INFLATION
American workers' wages, salaries and benefits rose 3.5 percent last year, the government said Tuesday. Although it was the smallest yearly increase on record, workers' compensation still outpaced inflation.The Labor Department said its Employment Cost Index slowed from 4.3 percent in 1991, due in part to a 0.6 percent advance in the fourth quarter. Costs had risen 1.1 percent in the three months ended in September.
The annual increase was the smallest since the Labor Department began keeping the statistics in 1982. That year, labor costs jumped 6.6 percent.
The index is considered one of the best gauges of wage inflation pressures. Employees usually have little leverage to boost their wages during periods of weak economic growth and high unemployment.
Wages and salaries, which are about 75 percent of overall worker compensation, rose 2.7 percent last year, down from 3.6 percent in 1991 and also the smallest increase since the statistics have been reported.
That meant wages and salaries were unable to keep pace with rising costs. But it also meant employers were able to hold down their costs of doing business, which helps hold down the nation's overall inflation rate.
Benefit costs, however, grew faster than consumer prices, up 5.3 percent in 1992 compared with 5.6 percent a year earlier. The smallest increase in benefits was 3.7 percent in 1987.
Health care costs, which jumped 6.6 percent last year, generally take the blame for advances in benefits.
Compensation cost increases in private industry were higher for blue-collar workers, up 3.6 percent, than for either white-collar or service workers, who received 3.3 percent and 3.1 percent increases, respectively.
Compensation cost increases also were higher for union workers, up 4.3 percent, than for non-union workers, up 3.2 percent.
Until about 18 months ago, non-union increases had exceeded those for union workers almost without exception for nearly a decade.
In a second report, the department said workers covered by collective bargaining agreements in the fourth quarter of 1992 won annual wage gains averaging 3.2 percent over the life of the pact. They replaced contracts that for the most part had been negotiated in 1989 and 1990 and that had provided 3.8 percent annual gains.
Also, the Conference Board, a New York business research group, said Tuesday its monthly survey showed that, while consumer confidence leveled off in January, it remained well above the levels of the past 18 months.
Consumers were more positive than last month in their assessment of prevailing business conditions but somewhat less optimistic in their expectations for the months ahead, the agency said.
Buying plans in January are less positive now than in December, the Conference Board reported, based on its survey of 5,000 U.S. households.