Image Source: Pixabay

According to the Bureau of Labor Statistics, the national unemployment rate rose from 4.0% in May to 4.1% in June. It has now risen for three consecutive months and is at its highest level since November 2021. I closely watch six labor market recession indicators and, as I mentioned in my article on June 13^th, four of them have already triggered a signal that a U.S. recession has begun or is about to start.

One of the recession indicators I monitor is shown in the chart below. The grey-shaded areas represent business cycle recessions in the United States. Crossings of the blue line up through the orange, horizontal threshold line (see circles) give the recession signals. The most recent signal came with the April reading.

Although this indicator has an impeccable and impressive track record of 75 years, one must keep in mind that this time it might be different. I always treat the signals as potential early warnings.

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