This includes a broader range of employment types, such as freelancers and part-timers, beyond just traditional sectors. Monitoring household employment gives us a fuller picture of the job market. A decline in this metric usually appears after other recession indicators and serves to confirm an economic slowdown is happening.

A decrease in household employment is generally a sign that businesses have cut back significantly, affecting workers’ ability to earn and spend, thus affirming that a recession is underway.

Recession Signal

There is no magic number that might signal a recession, using this indicator.

The NBER assess this metric by looking at:

1. Depth refers to the intensity of the economic downturn.
2. Diffusion indicates how widespread the downturn is across different economic sectors.
3. Duration measures how long the downturn persists.

Where a persistent and widespread drop could suggest a recession is underway or imminent.

Track this yourself

You can easily track Household Employment on TradingView, here: https://www.tradingview.com/chart/v7ZG3yMA/?symbol=ECONOMICS%3AUSEMR