May "Employment Trends Index" at 45-Month High

The Conference Board's Employment Trends Index (a composite index of eight individual labor-market indicators) increased in May by 0.29% to 108.34, up from April's revised reading of 108.3 (see chart above).  On a monthly basis, the Employment Trends Index (ETI) has increased in 11 out of the last 12 months.  On an annual basis, the May ETI was 7.6% above its year-ago level, following a 7% year-over-year improvement in April.

“While growth in employment has slowed significantly in recent months, the Employment Trends Index does not signal further slowing in the coming months,” said Gad Levanon, Director of Macroeconomic Research at The Conference Board. “Employers have been very cautious in hiring in the past two months, but at the moment, economic activity in the U.S. is just strong enough to require a modestly growing workforce.”

"May’s increase in the ETI was driven by positive contributions from five of the eight components. The improving indicators – beginning with the largest positive contributor – were Percentage of Firms with Positions Not Able to Fill Right Now, Initial Claims for Unemployment Insurance, Number of Employees Hired by the Temporary-Help Industry, Job Openings and Industrial Production."

MP: The ETI in May was at the highest level in 45 months going back to August 2008, and the 12-month gain of 7.6% last month was the highest annual increase in 14 months.  The gradual, but steady increases in the ETI reflect slow, but ongoing improvements in the U.S. labor market.