Solid Job Growth Predicted. Labor Market Tightens

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ETI Shows No Sign of Slowdown

The Conference Board Employment Trends Index™ (ETI) increased in May, following an increase in April. The index now stands at 133.70, up from 132.77 (an upward revision) in April. The change represents a 6.4 percent gain in the ETI compared to a year ago.

“While employment numbers have shown some softness in the past three months, there is no slowdown visible in the Employment Trends Index, suggesting solid job growth over the summer,” said Gad Levanon, Chief Economist, North America, at The Conference Board. “Employment will likely grow fast enough to continue tightening the labor market.”

May’s increase in the ETI was fueled by positive contributions from seven of the eight components. In order from the largest positive contributor to the smallest, these were: Percentage of Respondents Who Say They Find “Jobs Hard to Get,” Ratio of Involuntarily Part-time to All Part-time Workers, Initial Claims for Unemployment Insurance, Industrial Production, Number of Employees Hired by the Temporary-Help Industry, Percentage of Firms with Positions Not Able to Fill Right Now, and Job Openings.

The Employment Trends Index aggregates eight labor-market indicators, each of which has proven accurate in its own area. Aggregating individual indicators into a composite index filters out “noise” to show underlying trends more clearly.

The eight labor-market indicators aggregated into the Employment Trends Index include:

  • Percentage of Respondents Who Say They Find “Jobs Hard to Get” (The Conference Board Consumer Confidence Survey®)
  • Initial Claims for Unemployment Insurance (U.S. Department of Labor)
  • Percentage of Firms With Positions Not Able to Fill Right Now (© National Federation of Independent Business Research Foundation)
  • Number of Employees Hired by the Temporary-Help Industry (U.S. Bureau of Labor Statistics)
  • Ratio of Involuntarily Part-time to All Part-time Workers (BLS)
  • Job Openings (BLS)**
  • Industrial Production (Federal Reserve Board)*
  • Real Manufacturing and Trade Sales (U.S. Bureau of Economic Analysis)**

*Statistical imputation for the recent month

**Statistical imputation for two most recent months

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