The Conference Board Employment Trends edged down in October, and there are signs of cooling in the US labor market.

“The Employment Trends Index ticked down slightly in October and has been on a declining trend since it reached its peak in March 2022,” Selcuk Eren, senior economist at The Conference Board, said in a press statement.

“While changes have been minimal month to month and the index remains elevated, there are signs of cooling as recent job gains have been mostly concentrated in industries facing major labor shortages including in-person services and government,” Eren said. “If labor markets continue cooling and wage growth slows further, the Federal Reserve may be done with interest rate hikes for the current tightening cycle.”

Overall, the Employment Trends Index declined to a reading of 114.16 in October from a downwardly revised 114.63 reading in September.

Eren noted that industries that have not fully rebounded from the pandemic, such as leisure and hospitality and government, will continue experiencing job growth. Similarly, the healthcare and social assistance sectors will maintain a positive employment trend due to labor shortages and the aging US population.

“Elsewhere, we see declines in labor demand, especially in industries that boomed during the start of the pandemic. Information services, finance and insurance, and transportation and warehousing continued shedding jobs in October, and employment in the manufacturing industry has been stagnant over the last year,” he said.

“These developments are observed in several components of the ETI with declines in job openings, a higher share of involuntary part-time workers and a small uptick in initial claims for unemployment.”

The Conference Board’s outlook maintains a prediction of a short-lived recession in 2024, characterized by a negative GDP growth but with minimal impact on the unemployment rate.