Story here. The jobs slowdown is not a surprise to me because I’ve been tracking the economic activity for months. The slowdown was forecast by slumping commodity prices begun more than a year ago. Employment indicators are lagging indicators.

This is the sequence of some economic activities that corresponds to changes in the economy, starting from leading indicators, then coincident indicators, then to lagging indicators. Leading indicators forecast future changes, coincident indicators are a snapshot of what’s happening now, and lagging are histories of what happened some time ago.

In order: (Leading) The joint financial market action of widening credit spreads, deteriorating stock market internals, falling commodity prices, and falling yields on Treasury debt, new orders, order backlogs, and production components of regional purchasing managers’ indices and Fed surveys (such as Philly, Richmond, Chicago), followed by (Coincident) real sales, real production, real income, followed by (Lagging) new claims for unemployment, and confirmed much later by payroll employment. Employment figures (initial claims for unemployment, non-farm payrolls, the unemployment rate, and the duration of unemployment, in that order) are the most lagging economic series available, and typically turn well after the economy does. This information is supplied by John Hussman, PHD.