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Tuesday, August 26, 2003

Boskinising Labour Market Data

Writing strongly against the clock - I have to go and interview someone in ten minutes - I'm posting a link sent to me by Mark in connection with the US labour market and my 'another Boskin needed' post. It's a thing called the help wanted index and it's published by the Conference Board:

Help-Wanted Index--Key Job Barometer--Increases Three Points

The Conference Board's Help-Wanted Advertising Index – a key barometer of America's job market – increased three points in June. The Index now stands at 38. It was 47 one year ago. In the last three months, help-wanted advertising declined in six of the nine U.S. regions. Steepest declines occurred in the New England (-12.1%), East South Central (-11.6%) and Middle Atlantic (-9.7%) regions. Increases occurred in the Mountain (10.3%), West North Central (4.2%) and Pacific (3.8%) regions.

Says Conference Board Economist Ken Goldstein: “There are signs that overall economic growth will pick up in the third quarter. The Coincident Economic Index edged higher in June while the Leading Economic Index rose for the third straight month. So the indicators were showing a little more economic growth as early as June, with a suggestion that this trend could continue. However, because want-ad volume was lower in June than in January, hiring is not likely to pick up through the summer months. The Consumer Confidence Index fell in July, reflecting discouragement that despite a year and a half after the recession ended, consumers may face another six months before the labor market turns around.” The Conference Board surveys help-wanted advertising volume in 51 major newspapers across the country every month. Because ad volume has proven to be sensitive to labor market conditions, this measure provides an important gauge of change in the local, regional and national supply of jobs.

This index, as far as it goes, seems fair enough. It does what it claims to do: assess the US job market in tems of the relative difficulty of finding work. It seems, trom the last reading that finding a job right now is, as we imagined, tough. But it doesn't tell us the other side of the picture: the job seeking situation. It doesn't tell us what is the real impact of a change from 6.2 to 6.3 or to 6.4% measured unemployment. It doesn't help the problem of having to say: 'many people, as we know, have given up looking for work'. What I would like to see is a more precise measure of just how many people have given up: participation figures can help us with this. I would also like to know what is the back up in the number of people arriving in the labour market. We know this is growing, but this also forms part of the measure of labour market conditions. Are more youg people giving up looking, or more old people? This, maybe, can tell us something about the future productive potential of the economy etc.

BTW: one interesting little detail. The village of Enguera was actualñly the site, in the mid nineteenth century of the first steam engine in Spain. I have just been shown round - by two Bulgarians of course - a most splendid new wine 'cave' (and have come up here replete with the appropriate samples). Everything I have seen was built and introduced in the last twelve months. It seems there is something behind the idea of the importance of tradition in the continuity of innnovative potential. (More on this in a subsequent post, when time permits).

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