Labor cost is a significant portion of the production cost of every industry. This is particularly true for the transportation industries, which are much more labor intensive than industry as a whole. Changes in labor cost directly affect the price of transportation services, the profit margin, and competitiveness of the transportation industries.
As total compensation cost increases, the balance between wages and salaries and benefits also changes over time. These changes reflect changes in economic environment and labor management practices of employers. Reflecting the general trend, the share of benefit costs in total compensation cost increased in transportation industries over last decade. Though data on benefits were not available, this trend was evidenced by the increased gap between the total compensation cost index and the wages and salaries index of both transportation industry and transportation occupations. However, between the second quarter of 2000 and the second quarter of 2001, transportation industry's wage and salary cost increased 3.96 percent, faster than its total compensation cost (3.60). This change might indicate a new trend, though it is still too early to have an answer.
|Transportation Industry (Index)||Q2 00||Q2 01|
|Total compensation (private)||141.80||146.90|
|Total compensation (private) percent change from same quarter previous year||2.68||3.60|
|Wages and salaries (private)||136.20||141.60|
|Wages and salaries (private) percent change from same quarter previous year||1.87||3.96|
NOTES: The current value is compared to the value from the same period in the previous year to account for seasonality.
Employment costs of transportation industry is the weighted average of the employment costs of all occupations working in transportation industries, including nontransportation industries. Employment costs of transportation occupations is the weighted average of the employment costs of all transportation occupations, including those working in non-transportation industries, such as truck drivers working for retail stores.
SOURCE: U.S. Department of Labor, Bureau of Labor Statistics, Employment Cost Trends, available at http://www.bls.gov/ecthome.htm.