Job Market Resilience Despite Slowdown

The U.S. labor market is exhibiting continued resilience, as indicated by the Conference Board's Employment Trends Index, which grew in July. This suggests an ongoing strength in employment despite a backdrop of low hiring and firing rates.

The index's positive trajectory occurred even as the composite index for payroll employment experienced declines in prior months. This rebound was partly fueled by an increase in the share of small firms reporting that jobs are "not able to be filled right now," reaching its highest level since June 2025.

Despite the positive signs, the index's growth was modest, remaining only 0.6% above its level a year ago. This suggests that payroll growth may be subdued in the upcoming months. Factors such as seasonal education worker cuts and normalizing hiring in the leisure and hospitality sector contributed to a dip in non-farm payrolls by 23,000 in July.

Other positive contributions to the index included a rise in job openings and an increase in real manufacturing and trade sales. Furthermore, the percentage of consumers reporting that "jobs are hard to get" fell slightly. However, an increase in the share of involuntary part-time workers and industrial production had negative impacts.