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Employment Cost Trends
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Metropolitan Area Estimates: Providing more geographical data for the cost of compensation

Estimates for metropolitan areas in the National Compensation Survey (NCS) program's Employer Costs for Employee Compensation (ECEC) are an insightful way to examine employee compensation in more geographical detail.

The NCS metropolitan area definitions are presently based off the United States Office of Management and Budget (OMB) Bulletin No. 13-01 . 1 The ECEC calculates private industry estimates for the 15 largest metropolitan areas by employment for every March data release.

Starting in 1988, estimates were published for 4 broad regions which are Northeast, South, Midwest, and West. Chart 1 shows the private industry compensation costs of the 4 regions for the current March release. In March 2004 the ECEC started publishing estimates for 9 census divisions as the ECEC switched to the North American Industry Classification System (NAICS) and the Standard Occupational Classification (SOC) system. This addition of 9 census divisions provided more geographical data for our data users; however, many data users requested even more detailed geographical data. In March 2009, the BLS began to calculate and publish the estimates for the 15 largest metropolitan areas with each March release alongside the estimates for the 4 regions and 9 census divisions.2

The metropolitan area estimates are calculated in a similar fashion as the national estimates. The current employment counts as well as the size class from the Quarterly Census of Employment and Wages (QCEW) are both used to weight the data so that it can represent the areas, industries, and occupations of the sampled area. For more information on sampling, look at the design section of the NCS Handbook of Methods. These estimates include the cost of total compensation as well as the cost and percent of compensation for wages and salaries along with total benefits.Total benefits is the cost of a comprehensive set of benefits an employer gives to their employee as compensation for their work. This includes leave, health insurance, Medicare, retirement, and other benefits that employers offer. Chart 2 illustrates the private industry compensation costs of the 15 metropolitan areas for the current March release.

Chart 3 shows the current private industry compensation costs compared to last year's compensation costs for the 15 metropolitan areas.

It should be noted that ECEC estimates are point in time estimates since the employment weights are not held constant. As such the BLS does not publish percent changes for the ECEC, only compensation cost and percent of total compensation. If data users want to measure the change over time for the metropolitan areas, they can use the Employment Cost Index (ECI).

ECEC private industry estimates for the 15 largest metropolitan areas are available since March 2009 and will be produced annually for the March reference period. For future publication dates, see Schedule of Releases for the Employer Costs for Employee Compensation.

The relative standard errors are also published so that users can assess the reliability of these estimates, see Relative standard errors for the Employer Costs for Employee Compensation. Users can obtain these estimates and their relative standard errors through the ECEC online database. The complete set is also available in Excel.

End notes

1 Bulletin No. 13-01 is dated February 28, 2013. For a more comprehensive explanation of metropolitan area definitions, see the Census' Metropolitan and Micropolitan page.

2 See BLS Introduces New Employer Costs for Employee Compensation Data for Private Industry Workers in 15 Metropolitan Areas.

 

Last Modified Date: June 16, 2022