The May jobs report from the government was a disappointment, with fewer jobs added during the month than were expected. However, this may not signal a trend.
In fact, there is a lot of data suggesting that the economy is doing quite well, and that job production should continue at a robust level as the year progresses.
One such set of data comes from The Conference Board, whose Employment Trends Index (ETI) increased in May, following an increase in April.
The index now stands at 133.70, up from 132.77 (an upward revision) in April. The change represents a 6.4 percent gain in the ETI compared to a year ago.
“While employment numbers have shown some softness in the past three months, there is no slowdown visible in the Employment Trends Index, suggesting solid job growth over the summer,” said Gad Levanon, Chief Economist, North America, at The Conference Board. “Employment will likely grow fast enough to continue tightening the labor market.”
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 Conference Board said.
May’s increase in the ETI was fueled by positive contributions from seven of the eight components measured for the Index.
In order from the largest positive contributor to the smallest, these were: Percentage of Respondents Who Say They Find “Jobs Hard to Get,” 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, Percentage of Firms with Positions Not Able to Fill Right Now, and Job Openings.
This would seem to indicate that demand for labor remains strong.