The job market is on track to continue its historically fast growth, as the latest data from the Conference Board Employment Trends Index shows. The index, which was 107.70 in May (revised from 107.35), rose to 109.84 in June. This is a 28.2% increase from June 2020.
Seven of the eight labor market indicators fueled the index’s growth last month, ordered from the indicator with the most positive impact to that with the least:
- Ratio of involuntarily part-time to all part-time workers
- Initial claims for unemployment insurance
- Number of temporary employees
- Percentage of respondents who say they find “jobs hard to get”
- Industrial production
- Job openings
- Real manufacturing and trade sales
The percentage of firms with positions not able to fill right now was the only component to negatively affect the index in June.
“The very rapid improvement in the Employment Trends Index in June suggests that strong job growth will continue through the summer,” Gad Levanon, Head of The Conference Board Labor Markets Institute, said in a press release. He also anticipated ongoing recruiting and retention challenges over the next few months, as well as continued wage growth.
Labor shortages may begin to stabilize by the end of the year. “But as the number of jobs in the US economy continues to grow at an historically high rate, unemployment may again dip below four percent within the next 12 months,” Levanon predicted. “A tight labor market is likely to be the new normal until the next recession.”