The Conference Board's Employment Trends Index (ETI) grew to 111.61 in December from a downwardly revised 110.23 in November, first reported as 110.41, and is up 5.4% from a year ago, the group announced Monday.
This month’s report incorporates annual revisions of standardization factors.
"After last month’s decline, The Employment Trends Index bounced back and is signaling solid employment growth through the winter," said Gad Levanon, chief economist, North America, at The Conference Board. "With gloom and doom views dominating the news in recent weeks, it is somewhat reassuring that leading indicators of employment are growing. While employment growth could slow down in 2019, it is still likely to expand fast enough to further tighten the labor market. All the main measures of wages are now rapidly accelerating, suggesting that more people from the sidelines will return to the labor force in 2019. The improving labor force participation rate in December led to an increase in the unemployment rate to 3.9 percent. The expansion in labor supply is allowing employers to more easily expand their workforce and meet demand for their goods and services."
The increasing indicators — from the largest contributor to the smallest — were: the percentage of firms with positions not able to fill right now, percentage of respondents who say they find “jobs hard to get”, the 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, and real manufacturing and trade sales, according to the Conference Board.
The ETI aggregates eight labor-market indicators, each of which has proven accurate in its own area. Aggregating individual indicators into a composite index filters out so-called "noise" to show underlying trends more clearly.
The eight labor-market indicators aggregated into the ETI 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); Part-time Workers for Economic Reasons (BLS); Job Openings (BLS); Industrial Production (Federal Reserve Board); and Real Manufacturing and Trade Sales (U.S. Bureau of Economic Analysis).
