In Fed's book, job market shifting from bad to beige

Although the job market seems to be looking slightly better, an actual increase in jobs may not show up until around the end of the year.

Paul Sakuma/ AP
A woman looks through job listings at JobTrain, an educational and training institution that also offers career counseling and job placement services, in Menlo Park, Calif., Sept. 3.

The US job market shows some tentative signs of stabilizing after its sharpest downturn since the 1930s. Several reports in the past week make this case, punctuated Wednesday by the Federal Reserve's "beige book" survey of conditions in 12 regions.

• The Fed survey found the overall labor market still weak, but that temporary-help firms – an important barometer of nascent shifts – see a slight pickup in demand in eight of the 12 regions.

• The small businesses surveyed by the National Federation of Independent Business, in a report released Tuesday, say they're as likely to hire as fire over the next three months. That's merely neutral, of course. But compared to the tide of negative numbers since last fall, beige is beautiful.

• A forward-looking index of employment conditions remained nearly flat between July and August, the Conference Board in New York reported Tuesday. The Employment Trends Index has been falling sharply for the past year, but edged down just 0.1 percent in August. The index comes from eight indicators, such as the percentage of people who say jobs are "hard to get," and the number of employers with unfilled positions.

These reports suggest an inflection point is near, although an actual increase in jobs may not show up until around the end of the year, reckons Conference Board economist Gad Levanon.

Not all the job market news shows a corner-turn in progress, of course. And history suggests that rebuilding employment after a credit major bust is a slow process.

Another employment survey released this week, from the temp-work provider Manpower Inc., finds employers still more likely to cut jobs than to hire for the rest of this year. Even Manpower's survey offers at least some glimmers of hope, however.

The survey is global in scope and shows positive trends in some Asian and European nations. In all, 19 of 35 nations in the survey show improving conditions (including China, Germany, France, Canada, and India), 10 are "stable" (including the US), and six are weaker (including Mexico and several East European countries).

The global picture matters to workers in the US, since it boosts prospects for a revival of trade activity worldwide. Forecasters generally say the big concern now is not whether there will be a recovery, but whether it will be strong enough to bring a significant easing of the unemployment rate. The beige book found little sign that US workers have bargaining power for higher wages.


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