The Kansas City Fed Labor Market Conditions Indicators (LMCI) suggest the level of activity declined slightly while momentum accelerated moderately in January. The level of activity indicator decreased by 0.05, from 1.22 to 1.17 in January. Meanwhile, the momentum indicator accelerated by 0.12, from -0.05 to 0.07. This month marks the first positive turn for momentum after two months of negative readings. However, in all three months, the momentum indicator was near its longer-run average; over the same period, the level of activity remained high.
These readings likely do not fully describe the state of the labor market at the end of January, as many of the input data series reflect conditions early in the month. For example, data from the Bureau of Labor Statistics’ Household Survey are from the reference period of January 8 through January 14. Additionally, the most recent data from the Job Openings and Labor Turnover Survey (JOLTS) are for December 2022. Therefore, labor market developments in the latter half of January will likely show up in the February 2023 LMCI readings.