Boston wages outpace rest of nation
Rise could make cost containment difficult
Private sector workers in the Greater Boston area saw their wages and salaries increase 3.9 percent over the last year, the highest increase among the nation’s 15 largest metropolitan area and the largest for that period since the federal government began indexing compensation costs in 2007.
The high rate of wage and salary growth is an indicator of a strengthening economy, but it also is a warning signal that efforts to contain health care and other costs may face difficulty if the economy keeps humming along. For example, the state has set a target of 3.6 percent for the annual growth in overall health care spending. In 2013, health care spending grew at a 2.3 percent rate, but that figure is likely to rise as wages and salaries increase.
The US Bureau of Labor Statistics on Tuesday released its employment cost index, which attempts to measure total compensation growth in the country’s 15 largest metropolitan areas. Total compensation consists of wage and salary growth plus any increase in employee benefits such as health care and paid leave.
Total compensation in the Boston metropolitan area grew at a 3.6 percent pace from March 2014 through March 2015, while wage and salary growth over that period was 3.9 percent. Boston was one of three metropolitan areas where both total compensation and wage and salary growth were greater than national averages. The national average for both total compensation and wage and salary growth was 2.8 percent.
The Boston metropolitan area stretches from Boston west to Worcester and north up to Manchester, N.H.