The Monster Employment Index is "a broad and comprehensive monthly analysis of of U.S. online job demand". It is calculated and released by Monster Worldwide, Inc. the large online employment company and it includes data from approx. 1,500 different employment sites. Why should you care? Because the Help Wanted Index of newspaper ads - the older, traditional gauge of current demand for employees - is no longer valid. The rapid spread and acceptance of Internet technology has completely changed the way employers advertise for open positions. Charts of both indexes are provided below.
This is the Help Wanted Advertising Index, published by the Conference Board. It is based on newspaper ads and several years ago it would point to a massive recession - but no longer, of course.
The green bars represent the Monster Employment Index (MEI), which is based on online job offerings and it obviously presents a very different picture, more consistent with what is actually happening in job creation and demand.
What is quite interesting with this index is that, unlike the Bureau of Labor Statistics monthly jobs data, it does not adjust its findings for the assumed "birth/death" of businesses, i.e. it does not add or subtract jobs depending on an estimate for the creation (or demise) of new business establishments. The BLS "birth/death" model is a very important element in the ultimate calculation of reported monthly job numbers; it skews them depending on its assumption of where we are in the business cycle. If we are deemed to be in an expansion, the model adds jobs to the actual BLS findings, on the presumption that the economy is adding new businesses and jobs quicker than the government can trace them - and vice versa if we are deemed to be in a contraction. This means that during inflection periods, i.e. when the business cycle changes direction - the job numbers as reported by BLS may be significantly overstated or understated until the "bias" in the model is adjusted.
Back to our charts: We observe that during the last six months the MEI is essentially flat and its annual rate of increase is rapidly coming down. This means the number of jobs advertised on the Internet are no longer rising from month to month. If we add that the Help Wanted Index is sharply down in the same period, we come to the conclusion that the total number of jobs advertised in the US is coming down. We don't quite know by how much yet, because the structural shift between newspaper and Internet job postings is still ongoing. But overall, it looks as if the employment situation has stalled.