US paychecks rise at modest 0.6 percent pace in 3rd quarter
WASHINGTON (AP) — U.S. workers' paychecks grew at a moderate rate over the summer, showing little sign of accelerating from the sluggish growth that has persisted since the recession ended.
The employment cost index, which tracks wages, salaries and benefits, rose 0.6 percent in the July-September quarter from the April-June quarter, the Labor Department said Friday. That is stronger than the second quarter's 0.2 percent gain.
Yet in the past 12 months, pay and benefits have risen just 2 percent. That's below the 3.5 percent to 4 percent typical of a healthy economy.
The modest annual gain is a sign that companies are still able to find the workers they need without offering much higher pay. That suggests the job market is not yet back to full health.
Federal Reserve officials consider wages and salaries a key indicator of the economy's health. A sustained pickup in wages would be a sign that the unemployment rate might not fall much further.
As the unemployment rate declines and gets closer to levels consistent with a strong economy, employers typically are forced to raise pay to attract and keep workers. But so far that trend hasn't kicked in.