Employer Cost for Employee Compensation: A comprehensive analysis of employee compensation requires data on labor cost changes from period to period as well as information on dollar costs at a given point in time. At the behest of Congress, BLS developed the Employment Cost Index (ECI) in the early 1970s to measure the rate of change in employee compensation, which includes wages and salaries and employer costs for employee benefits.

The Bureau used ECI data to develop the Employer Costs for Employee Compensation (ECEC) in 1987. ECEC cost levels are calculated by applying current, rather than fixed, employment weights to wage and salary and benefit cost data from the establishments in the ECI survey. Estimates are published annually in June using payroll data for the reference period that includes March 12th.

Like the ECI, the ECEC defines wages and salaries as the hourly straight-time wage rate. Straight-time wage and salary rates are total earnings before payroll deductions and include production bonuses, incentive pay, commissions, and cost-of-living allowances. Benefits include: Paid leave (vacations, holidays, sick leave, and other paid leave); supplemental pay (overtime, weekends, and holidays; shift differentials; and nonproduction bonuses); insurance (life, health, short-term disability, and long-term disability); retirement and savings (defined benefit and defined contribution); legally required benefits (Social Security, Federal and State unemployment insurance, and workers' compensation); and other benefits (severance pay, and supplemental unemployment benefits).