The Employment Cost Index measures all costs concerning employee compensation in the United States. It also measures wages, salaries, bonuses and benefits. Prepared quarterly by the United States Bureau of Labor Statistics, the Employment Cost Index is the most comprehensive report on the cost of labor in this country.

Employers use the Employment Cost Index to discern labor costs on a yearly basis, understand labor trends and assess the potential for wages to become inflated. Start your research on this complex yet valuable tool by considering its significance for your business.

1. Get Employment Cost Index information from the most dependable sources.

2. Speak to an Employment Cost Index consultant from a reliable online source or private economic firms.

3. Learn how to calculate the Employment Cost Index on your own.

Action Steps
The best contacts and resources to help you get it done

Go to the most trustworthy sources of the Employment Cost Index

As an employer, you'll need to base your employment decisions on the most reliable information regarding trends in bonuses, wages and benefits.

I recommend: The U.S. Bureau of Labor Statistics is the official federal agency that prepares the Employment Cost Index. Contact the Bureau to speak with one of its information specialists about the data used to publish the Index. Econoday has a meticulous website with the most recent data from the Employment Cost Index with noteworthy commentary to help you understand its significance.

Get the full picture from an Employment Cost Index consultant

Even finance experts admit to consulting with economic experts for help with Employment Cost Index analysis.

I recommend: UnderstandMarket.com brings together leading economists and market consultants who can piece together all the varied data relating to the Employment Cost Index and then relate it to you in simple terms. With 22 offices worldwide, NERA Economic Consulting provides economic analysis to governments, regulatory agencies, law firms and trade associations. Contact one of NERA's proven experts for insightful commentary and Employment Cost Index advice.

Seek Employment Cost Index training from online sources

If gauging economic factors is critical to your business, learn how to decipher them on your own with online assistance.

I recommend: The Employment Development Department with the State of California maintains a database that seeks to provide labor market information to businesses and the public. Research the Department's reports online which include an explanation of how to calculate the Employment Cost Index. The Street.com takes you systematically through the process of analyzing the Employment Cost Index and other key economic indicators.

Tips & Tactics

Helpful advice for making the most of this Guide

• •  You can use the Employment Cost Index to determine whether the increase in wages is warranted or not as long as you consider productivity factors as well.