The Kansas City Fed Labor Market Conditions Indicators (LMCI) suggest the level of activity increased modestly in August while momentum decelerated. The level of activity indicator increased by 0.05 in August from 0.83 to 0.88. This recent increase builds on a six-month period of strong growth, with the level of activity increasing 1.31 since its January reading of −0.43. Meanwhile, the momentum indicator decreased by 0.22 in August from 0.90 to 0.68. Both indicators remained above their longer-run averages in August.
These readings likely do not fully describe the state of the labor market at the end of August, as many of the input data series reflect conditions early in the month. In particular, the series do not include the effects of the increase in COVID-19 cases or the tightening of some states’ COVID-19 restrictions that occurred later in the month. For example, data from the Bureau of Labor Statistics’ Household Survey are from the reference period of August 8 through August 14. Additionally, the most recent data from the Job Openings and Labor Turnover Survey (JOLTS) are for July. Therefore, labor market developments in the latter half of August, including the labor market response to recent COVID-19 developments, will likely show up in the September 2021 LMCI readings.