The Conference Board Employment Trends Index™ (ETI) Increased in July
Employment growth likely to slow in the coming months
NEW YORK, August 10, 2020…The Conference Board Employment Trends Index™ (ETI) increased in July, following increases in May and June. The index now stands at 50.89, up from 49.46 (an upward revision) in June. However, the index is still down 53.8 percent from a year ago.
“Despite increasing again, the ETI’s July results mark a small improvement compared to the gains made in May and June. The slowing momentum likely resulted from the diminishing impact of the reopening of the economy,” said Gad Levanon, Head of The Conference Board Labor Markets Institute. “This stark deceleration represents a preview of what’s to come: Over the next several months, job growth will significantly put on the brakes, likely causing the national unemployment rate to remain in double-digit territory. Less generous government stimulus will dampen consumer spending. In addition, more waves of downsizing and bankruptcies will spur widespread layoffs—and thus further constrain the expansion of the US workforce.”
July’s increase was fueled by positive contributions from six of the eight components. From the largest positive contributor to the smallest, the components were: the Number of Employees Hired by the Temporary-Help Industry; Industrial Production; the Percentage of Respondents Who Say They Find “Jobs Hard to Get;” Initial Claims for Unemployment Insurance; the Ratio of Involuntarily Part-time to All Part-time Workers; 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
The Conference Board publishes the Employment Trends Index monthly, at 10 a.m. ET, on the Monday that follows each Friday release of the Bureau of Labor Statistics Employment Situation report. The technical notes to this series are available on The Conference Board website: http://www.conference-board.org/data/eti.cfm.
About The Conference Board
The Conference Board is the member-driven think tank that delivers trusted insights for what’s ahead. Founded in 1916, we are a non-partisan, not-for-profit entity holding 501 (c) (3) tax-exempt status in the United States. http://www.conference-board.org