U.S. Employment Cost Index highlights five decades of compensation growth
Half a century after its first release, the Employment Cost Index continues to track changes in U.S. wages, salaries, and benefits with a measure designed to avoid distortions from shifts in employment mix. The benchmark shows compensation costs have risen sharply over that period, with private industry wage and salary indexes up 573.0 percent from September 1975 to March 2026.
Highlights
- The U.S. Employment Cost Index marks 50 years, with private industry wage and salary index rising from 26.4 in September 1975 to 177.672 in March 2026.
- Wages and salaries for private industry workers increased 3.4 percent from March 2025 to March 2026, compared to over 6 percent 12-month gains in the late 1970s.
- Over five decades, the wage and salary index grew 573.0 percent, and employers' benefit costs increased 558.8 percent from December 1979 to March 2026.
Fifty-year benchmark for pay trends
As reported by the U.S. Bureau of Labor Statistics, the Employment Cost Index issued its first news release 50 years ago today, covering wage and salary changes from September 1975 to March 1976. The measure was introduced to show compensation costs without being affected by changes in relative employment levels across industries, occupations, and geographic areas.In the late 1970s, 12-month percentage changes in wages and salaries for private industry workers exceed 6 percent. More recently, wages and salaries rise 3.4 percent from March 2025 to March 2026. The current-dollar index for private industry wages and salaries stands at 26.4 in September 1975 and 177.672 in March 2026.
Long-term rise in wages and benefits
Over the past five decades, that change amounts to 573.0 percent growth in the wage and salary index for private industry workers. The figures underscore the ECI's role as a long-running indicator for labor cost movements across the U.S. economy.Benefit cost indexes are not available until the September 1987 news release, although historical data back to 1979 is later calculated and provided. As of March 2026, employers' benefit costs rise 558.8 percent from December 1979, based on data that are not seasonally adjusted.
Our earlier update on the S&P 500 (SPX) described the index pushing higher near 7,500 as bullish momentum held above key moving averages, while short-term oscillators hinted at potential overextension. The piece also highlighted improving earnings expectations—partly tied to AI-driven optimism—and easing macro/geopolitical risks as key supports, while noting traders were watching nearby resistance and support levels for a breakout or pullback.
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