U.S. labor costs rose steadily in the fourth quarter as a tightening jobs market gradually lifts wage growth, the government reported Friday. The Labor Department said its employment cost index (ECI)-the broadest measure of labor costs-increased 0.6 percent in the October-December period after a 0.6 percent gain the previous quarter. Wages and salaries, which account for 70 percent of employment costs, also rose 0.6 percent in the fourth quarter after a similar advance in the July-September period. For all of 2015, wages and salaries increased 2.1 percent, below the 3 percent level that economists say is needed to bring inflation closer to the Federal Reserve (Fed) 2 percent target. The report showed benefits increased 0.7 percent in the fourth quarter after rising 0.5 percent over the summer. For the year, benefits rose 1.7 percent. The ECI is widely viewed by policymakers and economists as one of the better measures of labor-market slack and core inflation.
