Source: Economics Group of Wells Fargo Bank, N.A.
Summary
Employment cost growth rose 0.9% in the second quarter and 3.6% over the past year. Costs for wages & salaries rose 1.0% over the quarter with broad-based strength, but the rise was not enough to buck the slower trend over the past year. Overall compensation growth is more or less consistent with the Fed’s inflation goal once accounting for the recent trend in labor productivity, keeping us of the view that the labor market is not a source of significant inflationary pressure at present.