Monday, February 07, 2011

Employment Trends Index Gains in January

The Conference Board reported today that its composite Employment Trends Index, based on eight individual labor-market indicators (including both hard economic data and confidence measures), increased in January for the fourth consecutive month. The index increased to 100.5 in January from 100.3 in December, and is now above its year-ago level by 7%, and above its cyclical mid-2009 low by 20 points (see chart above).

Says Gad Levanon, Associate Director, Macroeconomic Research at The Conference Board: “Despite anemic job gains in January, the Employment Trends Index suggests that employment growth is poised to accelerate. Both hard economic data as well as confidence measures have improved, and since employment growth typically lags, we expect larger numbers of jobs to be added back into the economy in the coming months.”


MP: The Employment Trends Index has been an accurate leading indicator of trends in payroll employment back to 1973. In that case, the ongoing gains in the index and the 20-point gain since mid-2009 predict that we can look for gradual improvements in labor market conditions in the months ahead. 

8 Comments:

At 2/07/2011 7:17 PM, Blogger morganovich said...

that's an interesting result in light of participation rate dropping to a 30 year low, employment to population ratio sitting likewise right at the low, and personal income recovering so slowly by historical standards.

i wonder where they are getting their optimism?

 
At 2/08/2011 7:49 AM, Blogger juandos said...

Well maybe the Conference Board should reconsider the one of their sources of data before releasing this optimistic flyer...

 
At 2/08/2011 10:54 AM, Blogger Buddy R Pacifico said...

morganovich and juandos have company in that the Conference Board Chief Economist has a tepid take on employment. I agree with Professor Perry and am optimistic the trend will accelerate for employment. Let's give increased 2011 hiring slots a chance to be filled and better weather for people to get to work.

 
At 2/08/2011 11:31 AM, Blogger James said...

White House sees job openings fall

“The Labor Department is reporting that job openings fell in December, for the second straight month, even as the economy slowly gains ground overall.”

http://content.usatoday.com/communities/theoval/post/2011/02/white-house-sees-job-openings-fall/1

 
At 2/08/2011 12:22 PM, Blogger morganovich said...

juandos-

yeah, amazing what happens when you actually true up the seasonal adjustments lately.

this is likely an artifact of weighting recent years more heavily in the seasonal calculations and the effect the severe downturn on skewing the pattern.

i'd be very careful trusting anything that has been seasonally adjusted until we have a few years of a more normal baseline to use.

 
At 2/08/2011 1:50 PM, Blogger juandos said...

"i'd be very careful trusting anything that has been seasonally adjusted until we have a few years of a more normal baseline to use"...

True morganovich but there's something else too, I think the definition of, "seasonal" needs an overhaul...

At one time 'seasonal' was more impacted by the agricultural sector but no longer...

Certain holidays used to have more impact on 'seasonal' I think...

A lot of part-time work used to be 'seasonal' but I don't think that fits as well as it used to either...

BTW how come there's been so revisions to employment numbers?

This doesn't seem like something I've seen before...

 
At 2/08/2011 2:39 PM, Blogger juandos said...

Consider the following that showed up on the Zer0Hedge: Guest Post: Why Small Business Isn't Hiring And Won't Be Hiring

 
At 2/08/2011 7:46 PM, Blogger morganovich said...

and yet more bad hiring news:

WASHINGTON – Employers posted fewer job openings in December, the second straight month of declines. That's a sign hiring is still weak even as the economy is gaining strength.

The Labor Department said Tuesday that employers advertised nearly 3.1 million jobs that month, a drop of almost 140,000 from November. That's the lowest total since September.

Openings have risen by more than 700,000 since they bottomed out in July 2009, one month after the recession ended. That's an increase of 31 percent.

But they are still far below the 4.4 million available jobs that were advertised in December 2007, when the recession began.

 

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