Shiller P\/E ratio<\/a><\/li>\n<\/ul>\n\n\n\nWhat are the limitations of the Unemployment rate?<\/h2>\n\n\n\n
As mentioned, the unemployment rate is a lagging indicator, so stock prices tend to move before the employment data. During recessions, unemployment rises while stock prices fall, but it\u2019s difficult to predict how high it will rise or how long it will rise for.<\/p>\n\n\n\n
The unemployment rate is affected by seasonality, as job creation is typically better during certain months of the year. Any changes in employment data should be compared to the same month during the previous year.<\/p>\n\n\n\n
The commonly cited U-3 unemployment rate doesn\u2019t include discouraged job seekers. It also doesn\u2019t account for underemployment – i.e. people who have part time jobs or jobs that don\u2019t match their qualifications and experience. That means that while unemployment may be falling, job seekers may be accepting inferior jobs and lower wages.<\/p>\n\n\n\n
Is the Unemployment rate a reliable indicator?<\/h2>\n\n\n\n
Unemployment data is reliable, but often lags stock prices. It can\u2019t always be used to time the market, but can provide valuable context about the likely direction of interest rates, corporate profits and consumer confidence. <\/p>\n\n\n\n
Besides the Unemployment rate, you can use our complete list of 12- essential market indicators<\/a> to make educated financial decisions.<\/p>\n","protected":false},"template":"","meta":{"disable_branded_featured_image":false,"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","ep_exclude_from_search":false,"footnotes":""},"_links":{"self":[{"href":"https:\/\/financer.com\/wp-json\/wp\/v2\/indicator\/27034"}],"collection":[{"href":"https:\/\/financer.com\/wp-json\/wp\/v2\/indicator"}],"about":[{"href":"https:\/\/financer.com\/wp-json\/wp\/v2\/types\/indicator"}],"version-history":[{"count":5,"href":"https:\/\/financer.com\/wp-json\/wp\/v2\/indicator\/27034\/revisions"}],"predecessor-version":[{"id":50376,"href":"https:\/\/financer.com\/wp-json\/wp\/v2\/indicator\/27034\/revisions\/50376"}],"wp:attachment":[{"href":"https:\/\/financer.com\/wp-json\/wp\/v2\/media?parent=27034"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}