Total compensation costs for civilian workers declined 3.7% over the past 12 months ending in March, after accounting for inflation, according to the Employment Cost Index report published Friday.
It’s the largest decline since the Bureau of Labor Statistics began inflation-adjusted records in 2001. What’s more, it comes at a time when compensation costs — which includes the wages employers pay plus health, retirement and other benefits — are rising swiftly, before accounting for inflation, as employers try to fill positions and hold on to their staff.
The data, which tracks changes in employers’ labor costs, quantifies the pain that people are feeling as prices rise faster than they have in the past 40 years. The increasing cost of food, gasoline and housing are eating away at workers’ paychecks.
The inflation-adjusted cost of wages and salaries fell 3.6%, while benefit costs dropped 4.2%, both the largest decreases since the…