WASHINGTON -- The U.S. Labor Department said Friday the cost of hiring and retaining workers grew in the third quarter.
Labor said the employment cost index rose 0.9 percent in the third quarter, the same rate as in the second quarter.
Benefit costs -- a big source of worry for employers recently -- grew 1.1 percent, the slowest pace in more than two years. But wages and salaries grew 0.7 percent, the fastest rate in a year.
The increase in overall costs was smaller than the 1 percent increase Wall Street had been expecting.
Analysts said it suggested that the rebounding labor market is not fanning much inflation, leaving the Federal Reserve free to slow the pace of interest-rate increases if it so chooses.
In the year through September, compensation costs were up 3.8 percent, down from 3.9 percent in the year through June.
Inflation has risen slowly this year despite the rapid increase of oil prices. The inflation gauge most closely watched by the Fed -- the core price index for personal consumption expenditures -- was up just 1.4 percent in the year through August.
