Monitor Unemployment for Recession Signals

Analyzing national unemployment rates through three-month averages provides insights into potential recessions. A current unemployment reading that is at least half a percentage point above the lowest reading in the past year often indicates the early stages of a recession, typically observed within three months of onset. Historically, unemployment rates show a gradual rise leading into a recession, punctuated by a notable increase during the early phase. A mild recession may see a two percentage point rise, as seen in past economic downturns.

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