A measure of job prospects in the U.S. weakened in May to the lowest level in four months, as employers slowed hiring because of economic uncertainty.
The Conference Board’s Employment Trends Index decreased 0.3 percent to 99.7 from the prior month’s reading of 100.1 that was revised down, the New York-based private research group said today. The measure climbed 5.3 percent from a year earlier.
Private payrolls climbed 83,000 in May, less than forecast and the fewest since June 2010, while the nationwide jobless rate rose to 9.1 percent, a Labor Department report showed last week. The data fanned concern that the lack of bigger job gains will limit consumer spending, which accounts for about 70 percent of the economy.
“It is becoming clear that employers are reacting to the growing uncertainty in the U.S. economy by slowing down hiring,” Gad Levanon, associate director of macroeconomic research at the Conference Board, said today in a statement. He said he expects “moderate job growth to continue.”
The Employment Trends Index aggregates eight labor-market indicators to forecast short-term hiring trends. On average, the gauge can signal a rebound in hiring as little as three months before the fact and can predict job declines six to nine months in advance, the Conference Board said.
Declines in five of the index’s eight components contributed to the decrease in the ETI. These included higher initial claims for unemployment benefits and a drop in the number of temporary workers, the Conference Board said.
Last week’s Labor Department report showed total payrolls, inclumding government agencies, increased 54,000 in May following a revised 232,000 gain the prior month that was smaller than initially estimated. The median estimate of economists surveyed by Bloomberg News was for a gain of 165,000.
Companies still reducing their workforce include H.J. Heinz Co., the world’s biggest ketchup maker, which in May announced plans to slash as many as 1,000 jobs worldwide and close five factories. Dean Foods Co., the largest U.S. milk processor, said it cut 600 positions last quarter and 140 early this quarter.