Recession watch · Updated weekly · Figures to 22 Aug 2026

Are we in a Recession right now?

Not on the numbers. The indicator with the cleanest real-time record reads -0.03 against its 0.50 trigger, unemployment is 4.1%, and new jobless claims are quieter than 97% of all weeks since 1967.

By Richard Baxter Further reading Updated 22 Aug 2026

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Every few weeks a headline decides the recession has already started, and every few weeks another one calls the all-clear - and if your plans hang on which is true, that noise is exhausting. So here is the question put to the data instead: the signal with the best record of calling recessions in real time, drawn over every official recession since 1960, so you can see for yourself how it behaves when the answer is yes - and where it stands this month.

So, what are we looking at, exactly?

The Sahm rule, built by the economist Claudia Sahm from one plain observation: when unemployment starts rising in earnest, it doesn't drift - it snowballs. The line takes the three-month average unemployment rate and subtracts the lowest that average has been in the past year. Near zero means the jobs market is holding; when the line crosses 0.50 (the dashed line), rising joblessness has historically already fed on itself, and the grey bands show the result: every official recession since 1960 has come with a crossing. This month the line reads -0.03 - below the trigger, in ordinary territory.

What is a recession - and who decides?

Not the newspapers, and not the two-negative-quarters shorthand you may have heard. In the US the dates are set by the National Bureau of Economic Research (a private, non-partisan committee of economists), which defines a recession as a significant, widespread and sustained decline in activity - jobs, income, output and sales together, not GDP alone. The catch for anyone asking this page's question: the committee dates recessions months or even a year after the fact. Its last dated recession ended in May 2020, and it has dated nothing since - which is why real-time signals like the chart above exist at all.

How good is this signal's record?

Fired at every one of the 9 recessions in its record - that's the reputation. The part the reputation leaves out: it has also crossed the trigger without a recession following. It happened in 1976, in the churn after a downturn, and it happened again in 2024: the line reached 0.57 in August 2024, the warnings ran for months, and no recession has been dated - Sahm herself argued at the time that her rule was likely overstating the weakening. A perfect-sounding signal with a public miss on its record is still a good signal - but it's a reason this page charts the line rather than just quoting it.

Is a recession coming, then?

This page won't forecast, and the record above is exactly why. What it can give you is the dashboard: the Sahm line (-0.03, quiet), unemployment (4.1%, easing), the yield curve (the bond market's own version of this question), and the fastest of them all - weekly jobless claims, below, which have jumped visibly at the front edge of every grey band. One number worth holding onto: this expansion is 74 months old, against a median of 92 between the recessions in this record - and the range runs from 12 to 128 months, which is the chart's way of saying expansions don't expire on a schedule.

What these signals can't tell you

When, how deep, or whose job. The Sahm line here is the real-time version - the one you'd have seen at the time - and unemployment figures get revised, so history's version is slightly cleaner than the live one. The official dates arrive long after the question matters. And a national all-clear says nothing about your industry or your town: plenty of people live through a private recession the national numbers never see.