The Conference Board Employment Trends Index (ETI) rose in February to 118.29 from a downwardly revised 118.14 in January 2023. The Employment Trends Index is a leading composite index for employment. When the index increases, employment is likely to grow as well, and vice versa. Turning points in the index indicate that a turning point in the number of jobs is about to occur in the coming months.
“The Employment Trends Index increased in February, but it has mainly been moving sideways over the past year,” said Frank Steemers, Senior Economist at The Conference Board. “So far, job growth in 2023 has been strong and the Index remaining quite high signals that solid job gains will likely continue over the next months. With such a strong labor market and wage growth still elevated, the Federal Reserve will likely continue to further increase interest rates in its mission to lower inflation.”
Steemers added: “While the labor market remains resilient, higher interest rates are expected to negatively impact job growth later in 2023. Signs of cooling are already visible in some industries. Job gains have slowed in transportation and warehousing, finance and insurance, and layoffs have already been implemented in the information services sector, which includes tech companies. The recent steep decline in job openings in construction may foreshadow reduced hiring over the next months as higher interest rates reduce demand for new construction projects. However, health care and social assistance and leisure and hospitality continue their rapid pace of hiring. Strong demand for workers is becoming more in balance with labor supply as participation rates have risen over the last months. Participation for those aged 25 to 54 is now back at its prepandemic rate of 83.1 percent. Nevertheless, labor shortages remain severe and are unlikely to disappear soon.”
February’s increase in the Employment Trends Index was driven by positive contributions from four of eight…
Read the full article here
