Moderate Job Increases Ahead, Employment Trends Index Up in April

Moderate job increases are ahead for the U.S., according to a much-watched economic index.

The Conference Board Employment Trends Index (ETI) increased in April. The index now stands at 111.68, up from 111.61 (an upward revision) in March. The April figure is 3.8% higher than a year ago.

“Despite weak economic activity, the Employment Trends index is still signaling moderate job growth in the coming months,” said Gad Levanon, director of macroeconomic research at The Conference Board.

“On average, employment has grown almost as fast as GDP over the past three years, and that is likely to continue into the third quarter of 2013,” Levanon said. “As a result, the average labor productivity of American workers will struggle to improve until GDP growth accelerates.”

April’s ETI improvement was driven by positive contributions from five of its eight components.

The increasing indicators — from the largest positive contributor to the smallest — were Number of Temporary Employees, Initial Claims for Unemployment Insurance, Job Openings, Industrial Production, and Real Manufacturing and Trade Sales.

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)**

The Conference Board publishes the Employment Trends Index monthly, at 10 a.m. ET on the Monday following each Friday release of the Bureau of Labor Statistics Employment Situation report.

Source: The Conference Board

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