Mercado de trabalho perto de um grande alerta de recessão
One of the best near-term recession indicators is the job market. The release of October‘s jobs report showed unemployment rose to 3.9%. Small increases in the unemployment rate have historically been sufficient to trigger a recession. This is called the Sahm Rule. Now, it’s not calling for a recession yet, but it may be getting close if the unemployment rate does not improve from here. Why It Has Worked Historically The Sahm Rule is designed to rapidly determine if the U.S. economy is in recession, in part, so that policymakers can respond. Its designed by economist Claudia Sahm. Using jobs data is helpful because it‘s released weeks ahead of most other economic metrics. This approach has merit because unemployment has a big impact on economic growth. Broadly two thirds of the economy is consumer spending, so when jobs are cut, it’s a fair bet that consumer spending falls, and hence economic activity typically weakens too because consumer spending is its largest component. Constructing The Metric The metric examines the current 3-month average of the unemployment rate compared to the low unemployment rate of the previous 12-months. The 12-month low of unemployment is currently 3.4% as occurred twice in January and April of 2023. Then the
