The Conference Board released a new “Job Loss Risk Index” measuring the likelihood of layoffs across the US economy. Those industries most at risk include information services, transportation and warehousing as well as construction. On the flip side, industries least at-risk include government, private education services, healthcare, and accommodation and food services.

“While a short and shallow recession remains our most likely scenario for the US in 2023, we expect job losses to vary widely by industry,” said Frank Steemers, senior economist at The Conference Board.

The index aims to help business leaders understand the dynamics of this recession and judge their own exposure, Steemers said.

The index incorporates six factors in ascertaining the likelihood of job losses in a particular industry: its exposure to labor shortages; sensitivity to monetary policy; job function and education levels required; the state of its pandemic recovery; longer-term trends in labor demand; and the age composition and experience levels of its workforce.

Information services ranks as the sector with the highest risk of job losses amid the upcoming recession.

The Conference Board noted that employment grew rapidly in information services amid the pandemic as adoption of new technologies such as telework, e-commerce and distance learning fueled growth expectations. The Conference Board also noted that valuations of high-growth companies are more sensitive to rate hikes as these firms are often highly leveraged.

In addition, the index data indicated there may be some temporary easing of labor shortages in 2023 as demand for workers diminishes. Still, recruitment and retention difficulties will remain with the unemployment rate projected to remain relatively low, and the labor shortages could quickly reappear once the economy starts growing again.