Leading indicators show labor market will be soft in March

The SHRM/Rutgers Leading Indicators of National Employment® (LINE(®) survey shows that employment expectations for March 2008 are down sharply in both the manufacturing and service sectors, which make up more than 90 percent of private sector employment. Recruiting difficulty still is increasing, but more slowly than a year ago.

Compared with March 2007, the employment expectations index dropped 18.3 points for manufacturing and 29.5 points for the service sector in March 2008. Within the manufacturing sector, the index dropped from 50.1 in March 2007 to 31.8 in March 2008. March 2007 was a month in which manufacturing employment decreased by 35,000 jobs on a seasonally adjusted basis. On a not seasonally adjusted basis, manufacturing employment decreased by 11,000 jobs in March 2007.

New-hire compensation (wages plus benefits) is growing more slowly than a year ago. Within the manufacturing sector, the new-hire compensation index fell from 8.6 in February 2007 to 5.7 in February 2008.

Recruiting difficulty remains a concern. However, the February 2008 recruiting difficulty index for manufacturing dropped substantially from February 2007 (10.0 compared with 18.5).

The latest LINE report can be found here.