(Bloomberg) -- U.S. employment costs rose in the first quarter by the most since the final three months of 2007 as both worker pay and benefits accelerated, the Labor Department said Friday.
• Employment cost index advanced 0.8 percent (forecast was 0.6 percent) after a 0.5 percent gain in the prior three months
• Wages and salaries also rose 0.8 percent in first quarter
• Benefits costs climbed 0.7 percent after rising 0.5 percent
• Total compensation, which includes wages and benefits, rose
2.4 percent over the past 12 months
The government’s quarterly read on employer costs offers another take on wage growth, which has gradually shown signs of picking up. The ECI, which measures employer-paid taxes such as Social Security and Medicare in addition to the costs of wages and benefits, has shown a fairly steady pace of increases. The sustained pickup is another sign of a tighter labor market that’s forcing businesses to compete for a dwindling share of available workers.
• Wages and salaries rose 2.5 percent from year earlier, biggest year-over-year gain since second quarter of 2016
• Year-over-year gain in ECI was biggest in two years
• Benefit costs in private industry rose 1.9 percent from first quarter of 2016, biggest advance since 2015
• Employer costs for health benefits rose 1.3 percent from year ago