Despite a disappointing jobs report on Friday, The Conference Board Employment Trends Index rose in April and indicates job growth ahead, though possibly at a slower rate than expected. It also found employers may be swapping out temporary workers.
“Despite the disappointing April jobs report, the Employment Trends Index significantly increased in April, suggesting strong employment growth in the coming months,” said Gad Levanon, head of The Conference Board Labor Markets Institute.
“Most of the index’s components are rapidly improving,” Levanon continued. “However, the number of employees in the temporary help industry, usually a strong leading indicator of employment, declined in April. Rather than signaling a weak outlook for job growth, it may reflect some substitution in employment as employers hire more regular employees and end contracts with temporary workers.”
The Employment Trends Index rose to a reading of 105.44 in April, up from a reading of 102.65 in March. The Conference Board noted the index is up 45.7% year over year in April.
“In the coming months we expect job creation to continue, but at a possibly slower pace than expected in light of the latest job numbers,” Levanon said. “A slew of indicators measuring recruiting difficulties, quit rates, and wage growth suggest the US economy is experiencing an historical, though probably temporary, labor shortage. Among the shortage’s many effects, it may put a damper on job growth.”