What Is the Help-Wanted Index?
The Conference Board's Help-Wanted Index (HWI) measures how efficiently employers are matching jobs to the available workforce (the unemployed) and is an important gauge on the economy.
The Conference Board, looking for a way to augment the portfolio of employment statistics, created the Help-Wanted Advertising Index in 1951. The most obvious contribution made by the HWI is its measure of the changes in employment demand as represented on the classified pages of newspapers, which is considered a leading indicator of unemployment. The arguably more meaningful contribution is the HWI's indirect measure of the slack in the job market—that is, how many jobs are going unfilled, or how efficient the job-matching process is.
Understanding the Help-Wanted Index (HWI)
When the Help-Wanted Index (HWI) is rising, it means there are a relatively large amount of positions needing to be filled. This can be interpreted as a shortage of workers. Because employers may have to raise wages to attract workers, wage inflation could ensue, which could have a negative effect on bond and equity markets.
Created first in 1951, the index totaled the lines of help-wanted classified ads from 51 leading newspapers, each from a different metropolitan statistical area around the United States.
The HWI was restructured to equal 100 in 1987 and is released to the public in a monthly press release. The Conference Board releases a national number for the HWI, along with regional numbers representing nine segments of the country, and a percentage number representing the proportion of the labor market with rising want-ad volume. The current HWI report can be found on the Conference Board's website.
The Conference Board is composed of a board of chairmen and trustees and its voting members. Most recently, these positions were filled by many high-ranking executives from corporations including Deutsche Bank, BBVA, Deere & Company, Johnson & Johnson, Monsanto, MasterCard, General Electric, Novartis, and State Farm Insurance.