29 January 2004, 16:35  US employment costs up less than expected in Q4

WASHINGTON, Jan 29 - U.S. employment costs in the final quarter of 2003 rose by the smallest amount in a year and by slightly less than expected, a government report on Thursday showed. The Labor Department said the Employment Cost Index, a broad gauge of what employers pay in wages, salaries and benefits, climbed 0.7 percent in the last three months of the year, down from a 1.0 percent increase in the previous quarter. Wall Street analysts had been expecting a 0.9 percent rise in costs.
Climbing healthcare and pension costs helped to push up the index. Benefits costs rose 1.2 percent, outpacing a 0.5 percent gain in workers' wages. It was the smallest rise in benefits costs since the third quarter of 2002, while the increase in wages and salaries was the slightest in a year. For the year, employment costs rose 3.8 percent, up from a 3.4 percent gain in 2002. The jobs market has yet to show signs of a sustained recovery even though other areas of the economy are gaining strength.||

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