Manufacturers’ orders and weekly hours are leading indicators, suggesting that a recession is coming. Duration of unemployment is a lagging indicator, suggesting that an expansion has occurred. Payroll employment and industrial production are coincident indicators. The fact that employment growth and industrial production have slowed dramatically and weekly hours are already falling suggests that the economy has reached a peak. It would be premature to conclude that it is in recession, however, when production and employment growth are still positive. |
