Job Market: Where Are We and What’s to Come?

Chart of the Week for September 1-7, 2006

The unemployment rate is currently at 4.7%. Drawing from this week’s release of employment figures, the graph above has two different views of the job market: how many jobs are available versus the number of people looking.

Help wanted advertising is linked to employment trends, and the purple line is a gauge for the number of online listings on the Monster.com site. At first glance, the graph indicates that labor market conditions remain solid. However, the upward trend in the graph is party explained by the Internet’s increasing role in the job marketplace. Also, the data should be adjusted for seasonal job needs. In reality, though conditions remain solid for the near-term, year over year, the job market is weakening.

The gold line shows the number of initial claims for unemployment insurance. Jobless claims are expected to rise gradually over the next year, continuing the trend since January. The labor market is losing strength, mainly due to fewer jobs in housing and related industries. Along with this and a decline in consumer spending, analysts expect more layoffs.

* This illustration was compiled by information from outside sources which are not affiliated with ICMA-RC. This information is being provided for educational purposes and is not intended to be construed as or relied upon as investment advice. The ICMA-RC does not offer specific tax or legal advice. Individuals are advised to consider any new investment strategies carefully prior to implementing. Past performance does not guarantee future results. Investment returns and principal value will fluctuate, so that an investor’s shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data illustrated. For performance data current to the most recent month end, contact ICMA-RC Services, LLC by calling 1-800-669-7400 or by writing to 777 North Capitol Street, NE, Washington, DC 20002-4240, or by visiting www.icmarc.org. Please consult both the current Vantagepoint Funds prospectus and MAKING SOUND INVESTMENT DECISIONS: A Retirement Investment Guide carefully for a complete summary of all fees, expenses, charges, financial highlights and investment objectives, risks and performance information prior to investing any money. Vantagepoint securities are distributed by ICMA-RC Services LLC, a broker dealer affiliate of ICMA-RC, member NASD/SIPC. For a current prospectus, contact ICMA-RC Services LLC, 777 North Capitol Street NE, Washington, DC 20002-4240. 1-800-669-7400. AC:0906-984