U.S. workers saw the largest increase in wages and benefits since September 2008, according to a new report from the Labor Department on Tuesday.

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The employment cost index, a gauge of total compensation for civilian workers, increased 0.6% in the second quarter. The cost of pay and benefits jumped 2.8% in the 12-month period ended in June, the highest yearly growth rate in nearly a decade.

Wages alone gained 2.8% over the past 12 months, which also reflected a near 10-year high.

Growth in benefits outpaced wages in the second quarter. Wages were up 0.5%. Benefits, which cover health care, retirement plans and other items, jumped 0.9%. That marks the fastest pace in four years.

Meanwhile, private workers fared better than the public sector. Total compensation in the private industry rose 2.9%, while government workers saw a 2.3% increase.

In a separate report, the Commerce Department said the price index for personal consumption expenditures rose 2.2% year-over-year in June, another sign that inflation is trending higher. The Federal Reserve plans to raise rates two more times in 2018, bringing the annual total to four, to counter rising inflation.