U.S Wages and salaries jump by 3.1%, highest level in a decade

- Wages and salaries rose 3.1 percent in the third quarter, the biggest increase in a decade, according to the Labor Department. - Overall compensation costs were up 2.8 percent, ahead of Wall Street expectations. - Wages have been the missing piece in the economic recovery, though the Fed has been raising rates to guard against future inflationary pressures. However the unemployment rate is now at 3.7 percent, the lowest since 1969, and wage pressures have begun to build. The Federal Reserve has been raising interest rates in an effort to stave off future inflationary pressures, though the central bank's preferred gauge of inflation rose just 2.5 percent in the third quarter, including a 1.9 percent increase for health benefits. The wage data came the same day that ADP and Moody's reported private payroll growth of 227,000 in October, easily beating Wall Street expectations. The combination of news sent Treasury yields higher in morning trading. Overall compensation costs for civilian workers rose 2.8 percent, tamped down in part by the small rise in benefit costs, which rose 1.9 percent for the 12-month period ending in September. Employers have been looking for non-salary measures to retain workers, but may have to start increasing wages to attract and retain talent. In addition to the tighter job market, various states, communities and private companies have passed minimum wage increases, adding to inflation pressures. https://ift.tt/2Of2yYl

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