A measure of job prospects in the U.S. climbed in October to a three-year high, a sign some companies may be looking ahead to an improving economy.
The Conference Board’s Employment Trends Index increased 0.7 percent to 101.92, the highest since October 2008, from the prior month’s revised reading of 101.2, the New York-based private research group said today. The measure rose 5 percent from October 2010.
Labor Department data last week showed payrolls grew by 80,000 workers last month and the unemployment rate dropped to 9 percent. Bigger job gains may be needed to give households the means to accelerate their spending, which accounts for about 70 percent of the economy.
The figures “signal a slightly more optimistic outlook for jobs,” Gad Levanon, associate director of macroeconomic research at the Conference Board, said today in a statement. Nonetheless, “the economy is simply not strong enough to deliver more than 125,000 jobs a month.”
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.
Improvements in six of the index’s eight components contributed to the increase in the overall gauge. These included a drop in the number of consumers saying jobs were hard to get in October, fewer first-time claims for unemployment benefits and rising demand for temporary workers, the Conference Board said.
Retailers like Macy’s Inc. and Kohl’s Corp. are adding staff for the holiday shopping season, while companies such as Whirlpool Corp. plan to cut workers, evidence of an uneven economic recovery.
The gain in October payrolls was the smallest in four months and less than median forecast of economists surveyed by Bloomberg News, the Labor Department’s jobs report showed on Nov. 4. Private hiring, which excludes government agencies, rose by 104,000 after a revised gain of 191,000.