Labor Market Conditions Index Flat

Nonfarm payrolls have risen a more-than-solid 255,000 and 292,000 the last two months but they barely register on the labor market conditions index, which at 1.0 in July and a revised negative 0.1 in June are completely flat.

But it takes more than just payrolls to move this index which is a broad composite of 19 separate indicators and is considered experimental by policy makers. This index trended in the positive mid-single digits during 2013 and 2014 before it began to gradually move south. But even at only 1.0, July's result is relatively good for this index, the first in fact to make it in the positive column this year.

Based on the long trend of this index, the labor market isn't that strong at all right now, yet Janet Yellen, back at June's FOMC press conference, downplayed the weight that this index carries with policy makers.