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Economy in Brief

U.S. Labor Market Conditions Index Turns Negative
by Tom Moeller  January 9, 2017

The Labor Market Conditions Index (LMCI) from the Federal Reserve Board includes 19 indicators of labor market activity, covering the broad categories of unemployment and underemployment. These include jobs, workweeks, wages, vacancies, hiring, layoffs, quits and other surveys of consumers and businesses. Because the trends in the index are slow-moving, Haver presents only the changes in the index. All are measured monthly and have been seasonally adjusted.

During December, the index value deteriorated to -0.3 from 2.1 in November, revised from 1.5. It was the first negative reading since May. During all of 2016, the index value also was below zero. At -0.5, it was the first negative figure since 2009. Contributing negatively in December were slower payroll employment growth, a higher unemployment rate and more continuing claims for jobless insurance. Contributing positively were a quicker rise in average hourly earnings, a higher labor force participation rate and fewer initial claims for jobless insurance.

The LMCI data are available in Haver's USECON database.

Low Interest Rates and the Financial System from Fed Governor Jerome H. Powell is available here.

Labor Market Conditions Index (SA) Dec Nov Oct Dec'15 2016 2015 2014
Monthly Index Change -0.3 2.1 1.7 2.4 -0.5 2.0 5.3
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