The Employment Cost Index (ECI) has become the new black on economic fashion circles and this morning's data will likely disappoint some. While meeting expectations with a 0.6% QoQ rise, this is slower than the 0.7% QoQ growth in Q3 and what is more problematic is much of the rise was driven by 2.5% YoY rise in Natural Resources industries (which we suspect will absolutely not be there going forward given the layoffs and collapse of the Shale industry). Furthermore, the total cost of employment index was pushed higher YoY by the biggest YoY surge in "benefits" costs since March 2012.
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Driven by not a surge in wages but a surge in "benefits" costs...
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Charts: Bloomberg
