While the US added 528,000 jobs in July, The Conference Board’s Employment Trends Index fell, indicating slower job gains ahead. The organization also cited recession concerns.

“The Employment Trends Index declined in July and has now been on a downward trend since March 2022,” Frank Steemers, senior economist at The Conference Board, said. “While the US labor market is currently still robust, the recent behavior of the index signals that slower job gains should be expected over the next several months.”

July’s Employment Trends Index level of 117.63 fell from June’s downwardly revised reading of 118.71.

Steemers said slower job gains would bring the labor market in line with the rest of the economy, where activity has already been slowing.

“It is increasingly likely that the US economy will fall into recession by year end or early 2023, with the Fed expected to continue raising interest rates rapidly over the coming months,” Steemers said. “While businesses are currently still struggling with severe labor shortages, they may soon see some reduced pressure in recruitment and retention difficulties as economic activity cools.”

However, The Conference Board expects the US unemployment rate to remain below 4.5% in 2023. It was 3.5% in July.