Private employees in the New York metro region have seen their total compensation increase 3.9 percent over the last 12 months, according to new data from the Bureau of Labor Statistics.
The Employment Cost Index, a quarterly report that tracks changes in American’s average wages and benefits, showed that compensation for private industry workers in the region saw a substantial increase for the 12-month period ended in June. Wages and salaries, the largest component of the total compensation metric, increased by 3.9 percent as well.
Local consumer prices, as reflected by the Bureau's New York area Consumer Price Index, rose 1.7 percent for the year ending in June.
The compensation percentage increase is the largest the metropolitan region has seen since the Bureau began tracking wages and benefits for metro areas in 2006, said Martin Kohli, chief regional economist for the federal Bureau of Labor Statistics.
One of biggest drivers behind the increase, Kohli said, is the impact the available labor pool is having on employers.
“We certainly have a very tight local labor market,” he said. “As the market tightens, employers who want to attract or retain [employees] need to increase wages.”
The New York-Newark metro area, which includes Long Island and parts of New Jersey, Connecticut and Pennsylvania, ranked first among the 15 largest metropolitan areas in the United States for the second consecutive quarter.
“It’s indicative of a continuing recovery and people having the ability to earn larger wage and salary incomes because the economy is getting better,” Kohli said. “The economy is getting closer to full employment.”
Nationally, total compensation increased 2.6 percent for the year ended in June, with wages and salaries seeing an increase of 3.0 percent. Kohli said that national increases in total compensation "have been in this vicinity" for the last two years.