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Employment Cost Index

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Employment Cost Index
An index compiled by the Bureau for Labor Statistics estimating the cost of hiring and paying the American workforce. Analysts closely monitor the employment cost index: an unexpectedly large increase may result in downward pressure in the market. This is because a rise in the cost of paying employees reduces profits, which in turn reduces stock prices. It may also reduce bond prices because rises in the ECI are seen as a harbinger of inflation.

employment cost index
A closely watched economic report by the Bureau of Labor Statistics that indicates the total cost of employing a civilian worker. A larger-than-expected increase in the index is likely to place downward pressure on both bond and equity prices.


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7 Employment Cost Index (1, 2, 3) Total compensation: Civilian nonfarm (4) 3.
The employment cost index is a measure of the change in the cost of labor, free from the influence of employment shifts among occupations and industries.
07 Compensation costs, as measured by the Employment Cost Index (ECI), had been rising at a slower pace since early 2005, but since the first quarter of 2006, this slowdown reversed itself; during the entire course of 2006, the pace of ECI growth sped up.
 
 
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