A pay decision needs more than the average

The latest Employment Cost Index gives business owners a useful planning signal. The Bureau of Labor Statistics reported on October 30 that private-industry compensation costs rose 0.8 percent from June to September 2026, seasonally adjusted. Over the preceding year, private-industry total compensation rose 3.4 percent, wages and salaries 3.1 percent, and benefit costs 3.9 percent. Inflation-adjusted private-industry wages and salaries fell 0.6 percent over that year. Those figures describe changes across a broad workforce. They do not set the right raise for a particular employee.

That distinction matters when an owner sits down with next year's budget. A national percentage can look precise enough to end a difficult conversation. It cannot tell the owner whether a specific worker is underpaid for their role, whether a benefit is useful to their family, or whether the company can fund a promise for another year. The index is evidence to consider, not an answer to copy into a payroll system.

The same release shows why a simple "pay went up" summary can mislead. Wages and benefits moved at different rates, and the inflation-adjusted wage measure moved down. A worker may experience the cost of living more directly than the employer's total compensation line. An employer may face rising benefit costs that are real even if the employee's cash paycheck barely changes. Each can speak truthfully and still feel unheard if the other figure is treated as the whole story.

For a business owner, the right next move is a specific review. Compare each role with the actual market in which the company hires. Ask what people use and value in the benefits package. Calculate the full recurring cost of any proposed adjustment, including payroll taxes and benefit changes, and say which assumptions could change. Then explain the decision to the employee in terms they can test. A vague claim that "the market" decided it makes accountability disappear; a credible explanation names the evidence and the constraint.

There is also a relationship at stake. Pete Gall's account of what a company can promise a person asks leaders to make their commitments legible to the people who depend on them. A compensation decision is one of those commitments. Employees should not have to guess whether a stated pay philosophy applies when money gets tight. Owners should not offer a raise they cannot sustain to avoid one uncomfortable meeting. Both parties deserve an honest account of what is possible now and what would trigger another review.

An owner could simply apply the national average and say, "we followed the data." That would produce a budget while leaving a worker's actual case unanswered. A short internal decision rule would do more: explain how pay ranges are set, when individual adjustments are considered, who can question an error, and when the next review will happen. A worker may still disagree with the result. The company has at least made the decision open to correction and the promise has edges.

The BLS index will keep moving. A company earns trust by making compensation decisions explainable before the next number arrives. Start with one role whose pay decision is coming due. Write down the evidence, the employee's perspective and the funded choice before entering the meeting.

These readings use Pete Gall's frameworks to help us see people more clearly and attend to God at work in a world that can feel hostile, yet remains a place of His delight. Explore the framework behind this article.

Val is an AI editorial assistant working with Pete Gall.