Sahm Rule Indicator vs Nonfarm Payrolls
Live side-by-side comparison with current values, changes, and key statistics.
Why This Comparison Matters
Sahm triggers when the 3-month unemployment average rises 0.5 percentage points above its 12-month low. Comparing it to payrolls reveals whether Sahm is signaling true labor-market stress or a supply-driven unemployment rise. Positive payrolls growth alongside a Sahm trigger is unusual and raises questions about the Sahm signal.
Cross-Asset Analysis
Sahm Rule Recession Indicator captures sahm Rule: 3-month average unemployment rise from 12-month low. Crossing 0.5% has signaled every recession since 1970, whereas Nonfarm Payrolls reflects total nonfarm employment, the single most-watched monthly jobs number, and the difference between how they move is what the cross asset pair relationship is really about. Regime identification based on Sahm Rule Recession Indicator-Nonfarm Payrolls can be self-reinforcing, because extreme spread values often resolve via mean reversion or regime change.
Liquidity-driven regimes produce cross-asset co-movement in Sahm Rule Recession Indicator and Nonfarm Payrolls; fundamentals-driven regimes produce decoupling. Correlation trading desks price options on the Sahm Rule Recession Indicator-Nonfarm Payrolls spread once the underlying relationship has been mapped across enough regimes. Implied volatility regimes in Sahm Rule Recession Indicator and Nonfarm Payrolls transmit through hedging flows that connect one venue to the other via dealer balance sheets.
Tactical allocators rotate across the Sahm Rule Recession Indicator-Nonfarm Payrolls spread based on where each asset sits relative to its fundamental anchor. Analysts pair Sahm Rule Recession Indicator with Nonfarm Payrolls to build cross-asset indicators that are harder to game than any single-market series. Real yields, liquidity conditions, and the dollar underlie most cross-asset relationships, and when these change Sahm Rule Recession Indicator and Nonfarm Payrolls both respond at asymmetric speeds.
90-Day Statistics
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Frequently Asked Questions
What is the relationship between Sahm Rule Recession Indicator and Nonfarm Payrolls?+
Sahm Rule Recession Indicator and Nonfarm Payrolls are connected through shared macro drivers across asset classes. When the dominant macro driver shifts, both respond, though with different sensitivities and at different speeds. The spread between Sahm Rule Recession Indicator and Nonfarm Payrolls captures the specific macro signal that flows through this relationship.
When does Sahm Rule Recession Indicator typically lead Nonfarm Payrolls?+
Sahm Rule Recession Indicator tends to lead Nonfarm Payrolls during macro regime changes, where the more liquid asset moves first. In those periods, moves in Sahm Rule Recession Indicator precede corresponding moves in Nonfarm Payrolls by days to weeks, depending on the transmission channel and the depth of each market.
How are Sahm Rule Recession Indicator and Nonfarm Payrolls historically correlated?+
Long-run correlation between Sahm Rule Recession Indicator and Nonfarm Payrolls varies by regime. Cross-asset correlations vary by regime, tending to tighten in stress and loosen during normal conditions. The correlation is not stable: it shifts with macro conditions, and the periods when it breaks down are often the most informative moments in the Sahm Rule Recession Indicator-Nonfarm Payrolls relationship.
What macro conditions drive divergence between Sahm Rule Recession Indicator and Nonfarm Payrolls?+
Divergence between Sahm Rule Recession Indicator and Nonfarm Payrolls typically arises from idiosyncratic shocks in one asset, policy interventions, or structural shifts in demand. When one asset's idiosyncratic drivers dominate, the spread moves in ways that the common macro story does not predict, which is usually a signal to look more carefully at the specific drivers at work in Sahm Rule Recession Indicator or Nonfarm Payrolls.
Is Sahm Rule Recession Indicator a hedge for Nonfarm Payrolls?+
Cross-asset hedges between Sahm Rule Recession Indicator and Nonfarm Payrolls work when the macro drivers of the two assets are sufficiently decorrelated, which depends on the regime and therefore needs to be reviewed as conditions change. Effective hedging requires matching the hedge to the specific risk being protected, and the Sahm Rule Recession Indicator-Nonfarm Payrolls pair is best stress-tested under scenarios the investor most worries about before being sized into a real portfolio.
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Data sourced from FRED, CoinGecko, CBOE, and other providers. This page is for informational purposes only and does not constitute financial advice. Past performance does not guarantee future results.