Growth in employee costs slows in first quarter

WASHINGTON (Reuters) - Civilian employment costs rose more modestly by 0.4 percent during the first quarter, primarily because growth in benefits slowed after a sharp rise in last year's fourth quarter, Labor Department data showed on Friday.

The gain in employee costs was slightly lower than the 0.5 percent rise forecast by analysts surveyed by Reuters. Costs had increased 0.5 percent in the final three months of 2011.

Benefit costs, which account for 30 percent of compensation, grew by 0.5 percent in the first quarter after a sharp 0.7 percent rise in last year's fourth quarter.

Wages and salaries - the other 70 percent of costs - were up 0.5 percent in the first three months this year, a pickup from the 0.3 percent gain posted in last year's closing quarter.

(Reporting By Glenn Somerville; Editing by Andrea Ricci)