Quarterly Labor Costs Up 1.6%, Year’s Steepest Gain

Labor costs for U.S. employers rose 1.6% in the third quarter, the Labor Department said Tuesday, the steepest increase this year and a sign of rising inflationary pressures.

The department also said wages have jumped at their highest rate in the past 12 months since September, 1985. The department reported that gross pay, after deducting benefits, rose 4.6% in the year ended Sept. 30, against a 5.0% gain for the September, 1985, year.

The 1.6% increase in total wages, salaries and benefits for the quarter, compared to a 1.1% gain in the 1989 second quarter and a 1.3% rise in the third quarter of 1988.

The Labor Department said spiraling health-care costs in private industry pushed up total compensation costs. Health insurance bills rose 13.7% during the year ended Sept. 30.