Compensation Growth Holds at Low LevelCompensation, as measured by the employment cost index, edged up to 0.4% in the third quarter. Before rounding the increase was 0.36%, matching the second quarter expansion. However, year-ago growth sank to 1.6%, its slowest rate over the 25-year history of the series. The flat quarter-ago expansion was matched in each of the components. The wage and salary uptick of 0.36% matched the component's second quarter performance, while the benefits' increase of 0.36% was up from 0.27% in the prior quarter. The high wage growth of late 2007 and early 2008 that sparked concerns about inflation is long gone, and the current slow growth is likely to persist over the medium term. Persistent declines are unlikely, but a sustainable uptick will not occur. Deflation, which was a concern earlier in the year is no longer a significant fear, as the Federal Reserve will act aggressively to promote stability. Instead, low inflation will remain the theme in the near term, as workers face slow wage growth. The slow crawl of wages over the coming quarters will weigh on consumers' ability to increase their spending or meet existing debt obligations....
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