Federal Reserve Chair Janet Yellen turned to a recently developed tool -- an index of 19 labor market indicators created by Fed staffers -- to help sum up her message on how monetary policy can respond to the state of the American worker: It’s complicated.
The so-called Labor Market Conditions Index is a recently developed model that includes several of the gauges Yellen has cited in speeches that predate her chairmanship, including measures on the rates of hiring and quits in the Labor Department’s Job Openings and Labor Turnover Survey. There are two indicators of the length of the workweek. Three calculate employment levels (private, government, and temporary help payrolls). And there’s a cluster of survey data, including the Conference Board’s index of jobs plentiful versus hard-to-get index and employer hiring plans from the National Federation of Independent Business.