Table 5 Lifecycle of the Expansion
Description: • Table 5 plots the unemployment rate against average weekly hours in manufacturing on a quarterly basis since the first quarter of 2020. • There are four phases: • In the initial phase of an expansion, unemployment is stable and remains high while there is a sharp rise in hours per week • In the second phase, the unemployment rate falls while hours per week tend to be relatively stable. • In the third phase, the unemployment rate is stable and hours per week decline • A contraction occurs when unemployment rises and hours per week falls Analysis: • Our plotting of the business cycle using the unemployment rate and average weekly hours indicates a resilient if slowed economic expansion with the unemployment rate remaining at a low 4.2% and a modest increase in average weekly hours.
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Center for Business and Economic Insight
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