Can the BLS hourly compensation cost measures be used to compare worker incomes?
No. The hourly compensation figures provide comparative measures of employer labor costs; they do not provide intercountry comparisons of the purchasing power of worker incomes. Prices of goods and services vary greatly among countries, and the commercial market exchange rates used to compare employer labor costs do not reliably indicate relative difference in prices. Purchasing power parities — that is, the number of foreign currency units required to buy goods and services equivalent to what can be purchased with one unit of U.S or other base-country currency — must be used for meaningful international comparisons of the relative purchasing power of worker incomes. Total compensation converted to U.S. dollars at purchasing power parities would provide one measure for comparing relative real levels of labor income. It should be noted, however, that total compensation includes employer payments to funds for the benefit of workers in addition to payments made directly to workers. Paymen
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