Employment follows business cycle more closely than expected
It has been popular wisdom that employment is a lagging indicator of economic growth: employers hold on to employees beyond the point when they have enough to do and don’t hire them back until there has been growth for a significant period of time. This means that the unemployment rate does not reflect an economic downturn until after it has begun, nor does it reflect the return to good times until after it has taken hold. Equally, measures such as hours worked and productivity mirror this pattern.
