Recession IndicatorsFederal Reserve / Claudia SahmMonthly

Sahm Rule Recession Indicator

What is Sahm Rule Recession Indicator?

The Sahm Rule signals a recession when the 3-month moving average of the unemployment rate rises by 0.5 percentage points or more relative to its 12-month low. Triggered, it has historically coincided with the start of a U.S. recession.

Why it matters

The Sahm Rule is a clean, model-light recession signal that has triggered with no false positives going back to 1970. It triggered in summer 2024, then partially reversed, prompting broad debate about whether the labor market is still loosening.

How to read prints

When it rises

Sahm Rule triggered (above 0.5); historically consistent with recession onset.

When it falls

Sahm Rule below trigger; labor market not signaling recession.

Frequently asked

What is the Sahm Rule?⌄
A recession signal: when the 3-month moving average of the U-3 unemployment rate rises 0.5 percentage points above its 12-month low, a recession has likely already begun.
Who created it?⌄
Claudia Sahm, former Federal Reserve economist, in 2019. The Fed and the White House CEA both publish official Sahm Rule series.
What is its track record?⌄
It has correctly identified every U.S. recession since 1970, with zero false positives, typically signaling within a few months of NBER recession start.
Why did the 2024 trigger draw skepticism?⌄
Unemployment rose partly because of labor-force expansion (immigration, re-entrants), not job losses. Claudia Sahm herself said the rule may overstate recession risk in this cycle.

Track it on Market Ontology

Monitor Sahm Rule Recession Indicator in real time on Macro Regime, alongside regime classification, transmission mapping, and cross-asset context.

SourceFederal Reserve / Claudia Sahm
FrequencyMonthly
CategoryRecession Indicators
FRED SeriesSAHMREALTIME
Unitpp
Related ModuleMacro Regime

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