Unemployment is at all-time high 3.7% now – might be signaling recession
Simon Moore, 6-26-2023, previously served as Chief Investment Officer at Moola and FutureAdvisor, CFA Charterholder and educated at Oxford and Northwestern "What To Look For In The June 2023 Jobs Report," Forbes, https://www.forbes.com/sites/simonmoore/2023/06/26/what-to-look-for-in-the-june-2023-jobs-report/
The unemployment rate did move up to 3.7%, testing the higher end of the range for this economic indicator that we’ve seen since March 2022. The increase in the unemployment rate may be statistical noise, but weekly unemployment data claims has been trending somewhat higher, too. This may matter because the Sahm rule for forecasting recessions signals that if the 3-month average of unemployment rises by 0.5% over its 12-month low, then we may be in a recession. This metric has a strong track record of forecasting recessions historically. Therefore, if the May rise in unemployment of 0.3%, is sustained, then there is a risk that the U.S. could be flirting with recession, despite apparently strong jobs growth. Still, it would likely take several months of negative jobs data to confirm that view.