Private Sector Data on the Labour Market

Alan Krueger describes here (on the Economix Blog) how the Gallup Organisation has developed five new indicators of daily economic activity. Every day Gallup polls 1,000 people; and in relation to the job market, it asks the following to those who work:

“Now thinking more generally about the company or business you work for, including all of its employees. Based on what you know or have seen, would you say that, in general, your company or employer is — 1) hiring new people and expanding the size of its workforce, 2) not changing the size of its work force, or 3) letting people go and reducing the size of its work force?”

Krueger reports that the gap between hiring and letting people go is strongly correlated with the number of new unemployment insurance claims each week. The Gallup data have the advantage of being computed daily, and so they provide an early warning of where the labor market is heading.