The Conference Board Employment Trends Index edged upward in July to a reading of 115.45 from a downwardly revised reading of 113.56 in June. The organization expects job growth to continue in the coming months, though at a slower pace.  

“The Employment Trends Index ticked up in July after two months of decline, signaling continued job growth in the coming months,” Selcuk Eren, senior economist at The Conference Board, said in a statement. “The index peaked in March 2022 and has been on a slow downward trend since then but remains elevated and notably above pre-pandemic levels. We expect positive employment growth for the coming months even if the rate slows down.” 

Eren noted that with continued strength in the labor market and elevated wage growth, The Conference Board anticipates the Federal Reserve will raise interest target rates one more time.  

“For the moment, the labor market is still tight. The Consumer Confidence Survey suggests workers are very optimistic about employment conditions: In July, the proportion of consumers saying jobs are ‘hard to get’ fell back to single digits — and the lowest level since March 2022,” Eren said.  

“Initial claims for unemployment insurance and involuntary part-time workers are very low,” he continued. “Job openings, while trending downwards, are still elevated compared to pre-pandemic levels — signaling continued labor market tightness. On the other hand, the number of employees working in temporary help services, an important early indicator for hiring in other industries, has been declining since it peaked in March 2022, suggesting slower job gains and eventually job losses.” 

The Conference Board anticipates the Federal Reserve’s rate hikes will have a discernible impact on job growth, with likely job losses in early 2024, according to Eren. The organization forecasts the unemployment rate to rise to 4.2% by the middle of 2024, corresponding to around 700,000 job losses.  

“However, we anticipate that jobs will quickly recover, and tight labor markets will return by the end of 2024,” Eren said. 

The organization noted July’s increase in the Employment Trends Index was driven by positive contributions from four of its eight components: percentage of respondents who say they find “jobs hard to get,” ratio of involuntarily part-time to all part-time workers, initial claims for unemployment insurance, and job openings.