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Kathryn A. Edwards

Is a Recession Coming? Beware of This Indicator

Unemployment claims might not be a reliable measure of actual layoffs.

The system needs work.

The system needs work.

Photographer: Stephanie Keith/Getty Images

Will inflation — or efforts to tame it — lead to a recession in the US? When such fears arise, people start paying a lot of attention to weekly unemployment-insurance claims, as an early indicator of layoffs that could augur a broader slump.

They should be careful. Unemployment claims are a flawed gauge that may be particularly skewed by the pandemic.