Charts of the Week
U.S. Federal Reserve Labor Market Conditions Index
Chart of the Week for May 13, 2016 - May 19, 2016
On a monthly basis, the U.S. Federal Reserve Board ("Fed") publishes its Labor Market Conditions Index ("Labor Markets"), which is produced from a model that employs 19 labor market indicators. The indicators are pulled from nine general categories: Unemployment and underemployment, Employment, Workweeks, Wages, Vacancies, Hiring, Layoffs, Quits, and Consumer and Business surveys. The chart above shows the monthly percentage change in the Labor Markets value for the period of January 2014 through April 2016.
As the chart indicates, Labor Markets were generally strengthening in 2014 and 2015. In contrast, Labor Markets weakened in each of the first four months of 2016. Some economists believe the decline so far in 2016 is a sign of a maturing labor market that is nearing full employment after several consecutive years of strong job growth and lowering unemployment. The Fed monitors Labor Markets as part of its dual mandate to foster maximum employment and price stability. Any indicator the Fed monitors can impact the future direction of interest rates and the economy. Based on the recent weaker results, stronger labor markets may be needed to confirm the continued strength in the U.S. economy.
Posted by: sarah_oz@yahoo.com
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