Employment Index in U.S. Increases for Third Consecutive Month
A measure of job prospects in the U.S. rose in December for a third straight month, indicating the labor market will strengthen in the first half of 2012.
The Conference Board’s Employment Trends Index increased 0.7 percent to 104.3, the highest level since August 2008, from 103.6 the prior month, figures from the New York-based private research group showed today. The measure climbed 4.7 percent from December 2010.
The report is consistent with Labor Department data last week that showed gains in payrolls accelerated alongside a decline in the unemployment rate. The overall outlook signals the world’s largest economy will weather the financial crisis in Europe.
“Job growth is picking up some steam,” Gad Levanon, director of macroeconomic research at the Conference Board, said today in a statement.
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 decline in the number of Americans saying jobs are hard to get and a drop in applications for unemployment benefits, the Conference Board said.
Payrolls grew by 200,000 workers last month after a gain of 100,000 in November, the Labor Department’s report showed on Jan. 6. The median forecast of economists surveyed by Bloomberg News called for an increase of 155,000. The jobless rate unexpectedly declined to 8.5 percent, the lowest level since February 2009, from 8.7 percent the prior month.
The Conference Board’s Levanon said December’s employment growth “likely overstates the trend” and gross domestic product won’t expand “fast enough to sustain such rapid job gains throughout the first half of 2012.”
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