• Online Forex trading Community

Forex trading articles

Forex Employment Indicators

In this page we cover the most important employment indicators for the online Forex market, including the ECI, the household survey and the establishment survey. Employment indicators are important economic indicators, and are used often for fundamental analysis of the online Forex trading market.

The Employment Cost Index (ECI)

The ECI is an important Forex employment indicator, and is published in a quarterly report from the U.S. Department of Labor. It measures the growth of employees' compensation, and this includes the wages and benefits that employees get.

The information in the survey is based on a report that is held at the end of the month every quarter. The information that is tracked by the ECI is the wages movements, the fringe benefits and the bonuses that are given to employees at various levels of the organizations.

The report is used to foresee the online Forex trading currencies price movements. As employees increase the pressure for wage raises, this raises inflation levels, as consumer prices move up in their prices. The inflation is assumed to go up if the ECI increases. This in turn lowers the online Forex currency price.

The ECI is a Forex employment indicator that measures the number of jobs in more than 500 industries that cover 50 states and 255 metropolitan areas.

The Employment Report

This report contains two employment reports inside: the household survey and the establishment survey.

The household survey is an employment indicator concerned with households, and is smaller, covering only 50,000 households.

the establishment is about businesses, is more comprehensive and thus it is preferred by analysts of the online Forex market. It covers 400,000 businesses with 47 million people.

The Establishment Survey

Non-farm Payrolls - This is a very important employment indicator for the establishment report, and has crucial importance for online Forex trading. it measures how many people are there on payrolls for non-agricultural businesses.

Average Workweek - This measures the average hours worked non-farm payroll employees, and is a fine judge of the overall strength of the employment report.

Aggregate Hours Worked - This index combines the two previous indexes together.

Average Hourly Earnings - This employment indicator gives us a good idea of the personal income growth during the month, and is especially critical in times of strong economic growth, as an evidence of increasing wage pressures, which can influence the online Forex trading market considerably.

The Household Survey

The Unemployment Rate - This index is calculated through the division of the number of people unemployed by the number of people in the labor force.

There are other employment indicators in the employment report but these are the relevant ones for the online Forex trading market.

Jim Barns, Market Analyst

Main Menu