The Conference Board Employment Trends Index™ (ETI) Increased in June
The Historically Rapid Job Growth to Continue
NEW YORK, July 6, 2021…The Conference Board Employment Trends Index™ (ETI) increased in June, after an increase in May. The index now stands at 109.84, up from 107.70 (an upward revision) in the previous month. The index is now up 28.2 percent year-over-year (i.e., compared to June 2020).
“The very rapid improvement in the Employment Trends Index in June suggests that strong job growth will continue through the summer,” said Gad Levanon, Head of The Conference Board Labor Markets Institute. “In the coming months, the US labor market is likely to remain very tight. Recruiting and retention will remain extremely difficult, and wage growth will remain very high. Toward the end of 2021, labor shortages are likely to moderate as some of the labor supply constraints ease. But as the number of jobs in the US economy continues to grow at an historically high rate, unemployment may again dip below four percent within the next 12 months. A tight labor market is likely to be the new normal until the next recession.”
June’s increase was driven by positive contributions from seven of eight components. From the largest positive contributor to the smallest, the components were: Ratio of Involuntarily Part-time to All Part-time Workers; Initial Claims for Unemployment Insurance; Number of Temporary Employees; Percentage of Respondents Who Say They Find “Jobs Hard to Get”; Industrial Production; Job Openings; and Real Manufacturing and Trade Sales. The only indicator with a negative contribution was Percentage of Firms With Positions Not Able to Fill Right Now.
The Employment Trends Index is a leading composite index for employment. 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 aggregates eight leading indicators of employment, 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 leading indicators of employment 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)**