Interested in Tracking the U.S. Labor Market? Here Are Some Key Indicators

Let’s say you want to find out how the U.S. labor market is doing. A simple search could turn up countless pieces of economic information.

Take the St. Louis Fed’s online economic database FRED as an example. In FRED, about 100,000 data series have the tag “employment.” The tags “labor” and “unemployment” have about 30,000 each.

Here are some key indicators you could look at to help you track the U.S. labor market. The list is largely based on indicators Fed Chair Jerome Powell mentioned in remarks on Aug. 23, 2024. He spoke at the annual Jackson Hole, Wyo., symposium sponsored by the Federal Reserve Bank of Kansas City.

Unemployment Rate



There are several measures of unemployment, but the one shown in this FRED chart is the official unemployment rate. This labor market indicator from the U.S. Bureau of Labor Statistics (BLS) survey of households is one of the most commonly cited.

The unemployment rate is the number of unemployed people as a percentage of the labor force, as defined by the BLS.

Job Growth



Another commonly cited labor market indicator is job growth. This FRED chart shows the net increase in monthly payroll employment. Estimates of the number of nonfarm workers on payrolls are from the BLS survey of establishments.

“Increases in employment or decreases in the unemployment rate usually signal an economic expansion, while the opposite tends to signal an economic slowdown or the leading edge of a recession,” business economist Kevin Kliesen wrote in an Aug. 20, 2024, On the Economy blog post, “Employment Trends before and after Business Cycle Peaks.” Kliesen is a research officer at the St. Louis Fed.

Labor Force Participation



Labor force data can provide insights on the supply of labor. The labor force is made up of people who have a job (employed workers) and those who don’t have a job but are actively looking and available for work (unemployed workers). The labor force participation rate reflects the share of the U.S. population that is in the labor force.

The FRED graph above shows the number of people in the labor force (blue line, left scale) to get a sense of total labor supply as well as the labor force participation rate (red line, right scale), which is affected both by changes in the labor force and by changes in population numbers.

Employment-to-Population Ratios



In addition to the labor force participation rate, the BLS provides employment-to-population ratios—or the share of the civilian noninstitutional population that is employed—for various demographic groups.

The FRED graph above shows these ratios for the overall U.S. population and by race and ethnicity. The graph gives a sense of how the ratio differs among racial and ethnic groups over time. It also shows that some ratios are more volatile than others, as discussed in a 2016 post in the FRED Blog, which tells stories using data series in FRED.

Job Openings, Hires, Quits and Layoffs



The Job Openings and Labor Turnover Survey (JOLTS) from the BLS provides data on the number of job openings, the number of hires and the number of job separations, which include quits, layoffs and discharges. (This FRED graph shows levels, or total numbers, for each month, but you can also find rates of job openings, hires, quits and layoffs in FRED.)

Higher levels of job openings, as well as higher levels of hires, coincide with stronger demand for labor and a stronger labor market.

The type of separation can also provide insight into current labor market conditions. As the JOLTS news release for June 2024 said, “The quits rate can serve as a measure of workers’ willingness or ability to leave jobs.” So higher levels of quits—which are generally voluntary and employee-initiated—can signal a stronger labor market. In contrast, higher levels of layoffs and discharges—which are involuntary and employer-initiated—may suggest a weaker labor market.

Ratio of Job Vacancies to Unemployment



This FRED graph shows the ratio of job vacancies to unemployed workers, or how many job openings there are per every unemployed person.

“This roughly reflects how high employers’ demand is for additional workers relative to the pool of people actively seeking work,” according to a July 18, 2024, FRED Blog post suggested by St. Louis Fed economist Charles Gascon and Joseph Martorana, a research associate. As such, higher ratios indicate a tighter labor market.

Other Helpful Resources

There are many labor market indicators beyond those highlighted in this post, including unemployment claims, wage growth and labor productivity—all topics that have been covered by the FRED Blog.

And if you’re looking for timely analysis on various aspects of employment and unemployment, check out the St. Louis Fed’s On the Economy blog for posts on these topics.