By Robb M. Stewart

U.S. labor-market indicators point to jobs growth in the coming months, according to an index gauging trends.

The Conference Board said Monday that its Employment Trends Index rose to 118.74 in January from an upwardly revised 117.06 the month before.

January's reading marks a second month in a row of growth, reversing a short-lived decline in 2022.

The employment trends index is a leading composite measure for employment that aggregates eight indicators. When the index increases, employment is likely to increase as well, whole turning points in the index suggest a change in the number of jobs is likely in the short term.

The indicator was published after the U.S. Labor Department's employment report on Friday showed broad-based hiring in the U.S. added 517,000 jobs in January and pushed the unemployment rate to a 53-year low of 3.4%.

"Despite rapid interest rate hikes, which were expected to reduce labor demand, we haven't seen widespread layoffs," said Selcuk Eren, senior economist at the Conference Board.

Mr. Eren said hiring was outsized and broadly based in the January employment report, and robust hiring continues to keep the Employment Trends Index at a very high level.

Seven of the eight components that form the index advanced in January, including initial claims for unemployment, real manufacturing and trade sales, industrial production, and job openings.

"Labor shortages will continue to be the theme going forward," Mr. Eren said.

"We have seen job gains in industries-including leisure and hospitality and government, where employment is still below prepandemic levels. Likewise, job openings and voluntary quits are below their historic highs but still above prepandemic levels," he said.

Mr. Eren added the number of employees working in temporary help services, a component of the Employment Trends Index and a leading indicator for hiring, increased in January after falling for two consecutive months.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

February 06, 2023 10:36 ET (15:36 GMT)

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