Conference Board News Release (02/09/15)

The Conference Board Employment Trends Index increased in January to 127.86, up from a downwardly revised 127.17 in December. This represents a 7.6% gain in the ETI compared with a year ago.

“The [ETI] suggests that strong job growth is likely to continue through the first half of the year,” says Gad Levanon, managing director of macroeconomic and labor market research at the Conference Board. “As a result, wage growth will accelerate, thereby increasing pressure on profitability which is already suffering from low productivity growth and the strong dollar.”

Wall Street Journal (02/06/15) Josh Mitchell

Over the past three months, which was the best 90-day period of hiring since 1997, the economy has created more than one million jobs, according to the U.S. Department of Labor. Average hourly earnings increased 0.5% in January and are 2.2% higher than the same time last year. However, these wage gains are still historically weak compared with income growth before the recession.

“The economy seems to be moving full steam ahead,” says Sung Won Sohn, an economist at California State University Channel Islands. Following years of tepid growth, “I think it’s the beginning of a healthy recovery.”

Wall Street Journal (02/06/15) Justin Lahart

U.S. payrolls increased by 257,000 in January, up from the 237,000 forecast by economists. Gross domestic product grew by a 2.6% annual rate during the fourth quarter of 2014, and is expected to expand 2.4% in the first quarter of 2015. The data could indicate that productivity may be contracting but more likely demonstrates that the economy is expanding faster than the current data show.

Wall Street Journal (02/06/15) Jon Hilsenrath

U.S. Federal Reserve officials are struggling to determine how hot they can let the strengthening labor market run before raising short-term interest rates from near zero. Although the market is showing signs of improvement, low wage growth and inflation remain. Fed chairman Janet Yellen will discuss lifting interest rates with colleagues during a two-day policy meeting starting on March 18. The bank will be “patient” when it comes to raising rates.