The Kansas City Fed Labor Market Conditions Indicators (LMCI) are two monthly measures of labor market conditions based on 24 labor market variables. One indicator measures the level of activity in labor markets and the other indicator measures momentum in labor markets. A positive value indicates that labor market conditions are above their long-run average, while a negative value signifies that labor market conditions are below their long-run average.
This morning’s LMCI print, at -4.8, indicates labor market conditions in the U.S. are deteriorating at their fastest pace in seven years. The -4.8 print was considerably worse than the -0.8 expectation:
Today, in her speech, Chairman Yellen called the poor jobs report of last Friday ‘transitory’ and said the balance of economic data is ‘positive’. Not in my books. The May jobs report and the downward revisions to the March and April reports are telling us that the trend is down and the economy is losing momentum. This report confirms it.