• Sun. Jun 23rd, 2024

Economic Downturn: 20 States on High Alert for Potential Recession Thanks to Rising Unemployment Rates”.

BySamantha Johnson

Mar 27, 2024
Cease Utilizing the Sahm Rule Recession Indicator for States

Over the past two years, the United States has been on high alert for a potential recession. Despite a brief respite at the beginning of 2024, the alarms are once again sounding. This time, economists are not focusing on traditional indicators such as an inverted Treasury market yield curve or low consumer and business sentiment. Instead, they are looking to rising unemployment rates in several states as a warning sign that a recession may be imminent.

The warning is based on a recession indicator known as the Sahm rule, developed by an economist. This simple rule states that if the three-month average of the unemployment rate is half a percentage point or more above its low in the previous 12 months, the economy is in a recession. When applied to individual states, this rule reveals that 20 of them should be in a recession. These states account for over 40% of the US labor force, including California, which alone makes up 11% of it.

The concerns about a potential recession are heightened by the fact that unemployment rates have been rising in several states. This has led some economists to believe that a recession may already be underway or may soon happen if not addressed promptly. It is crucial to closely monitor these indicators in the coming months to understand the true state of the economy and prepare for any potential challenges ahead.

In summary, while there have been periods of calm over the past few years, there is no denying that we are currently facing another “recession warning.” The Sahm rule indicates that several states should be experiencing economic downturns due to their rising unemployment rates. As such, it is essential to keep track of these indicators and prepare ourselves accordingly for any challenges ahead.

By Samantha Johnson

As a dedicated content writer at newsanguinely.com, I weave words into compelling stories that captivate and inform our readers. With a passion for storytelling and a keen eye for detail, I craft engaging articles that shed light on the latest news and trends. When I'm not typing away at my keyboard, you can find me exploring new ideas, researching diverse topics, and striving to deliver content that resonates with our audience. Join me on this journey as we uncover the stories that matter most.

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