Many people focus only on the unemployment rate, but economic downturns typically begin much earlier. Right now, we’re already in the first phase: hiring has been frozen, fewer new positions are being posted, and few employees have been laid off yet. This shift often goes unnoticed, but it’s a crucial signal. 📉 The second phase usually follows: companies don’t just hire less—they actively reduce headcount, leading to a rise in unemployment benefit claims. Only in the third phase does unemployment become visibly higher. By then, however, markets have often already priced in this trend months in advance. Understanding this sequence helps you better interpret economic shifts and recognize them earlier.