Linda Barrington, executive director of the Institute for Compensation Studies at Cornell University’s ILR School, discusses today’s Employment Situation report from the Bureau of Labor Statistics. Barrington says that faster-rising paychecks are the real indicator of a recovery.
“The most recent government numbers on employer compensation costs are consistent with claims that today’s jobs numbers are further evidence of an improving economy, although we’d all like to see that improvement be much stronger.
“The most recent federal Employment Cost Index reported that the 12-month increase in wage and salary costs hit a 19-quarter high of 1.9 percent. But that high point isn’t proof of a notable labor market strengthening.
“It’s only when the labor market recovery consistently shows up in faster rising paychecks, that we’ll start to feel like it’s a recovery.”