Compensation costs for civilian workers in the United States increased by 0.9% in the first quarter of 2026, following a 0.7% rise in the previous quarter and coming in slightly above market expectations of 0.8%. Wages and salaries climbed 0.8% (compared with 0.7% in Q4 2025), while benefit costs advanced at a faster pace of 1.2% (up from 0.8%), marking the strongest gain in five months.
By sector, compensation costs for private industry workers rose 0.9%, accelerating from 0.7% in Q4 2025, and those for state and local government employees increased 1.0%, up from 0.8% in the prior quarter. On a year-over-year basis, overall employment cost growth held steady at 3.4%, unchanged from the previous period.
