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Justin Fox

Keep an Eye on That Unemployment Rate

Unemployment troughs invariably precede recessions. We’re not there yet, but the rate does seem to have stopped falling.

Watch and wait.

Watch and wait.

Photographer: Ty Wright/Bloomberg

Amid a February jobs report in which an unexpectedly small gain of 20,000 payroll jobs was the big news, the 3.8 percent unemployment rate got less attention. It was down two-tenths of a percentage point from January, but the January number was probably boosted by the government shutdown, and small one-month moves like that usually don’t signify much anyway.

What might signify something, though, is that the unemployment rate was also 3.8 percent last May, August and October.