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A weak July jobs report just triggered one of the most well-known, and historically accurate, recession indicators: the Sahm Rule<\/a>. But the rule\u2019s inventor, Claudia Sahm, pushed back against the plethora of doomsday narratives that gained traction after its triggering on Friday.<\/p>\n \u201cI am not concerned that, at this moment, we are in a recession,\u201d she told Fortune,<\/em> adding that \u201cno one should be in panic mode today, though it appears some might be.\u201d<\/p>\n To her point, the Dow Jones industrial average sank 1.5% on Friday, while the S&P 500 and tech-heavy Nasdaq<\/a> Composite plummeted 1.8% and 2.4%, respectively.<\/p>\n But Sahm noted that household income is still growing, while consumer spending and business investment remain resilient. So there are key measures of the economy that \u201cstill look really good.\u201d July\u2019s unemployment figure was likely also boosted by 420,000 workers who entered the labor force last month.<\/p>\n \u201cThis time really could be different,\u201d Sahm said. \u201c[The Sahm Rule] may not tell us what it\u2019s told us in the past, because of these swings from labor shortages, with people dropping out of the labor force, to now having immigrants coming lately. That all can show up in changes in the unemployment rate, which is the core of the Sahm Rule.\u201d<\/p>\n The U.S. economy added just 114,000 jobs last month, and the unemployment rate rose from 4.1% in June to 4.3% in July, its highest level in nearly three years, the Bureau of Labor Statistics reported<\/a>.<\/p>\n It was that rise in the unemployment rate that triggered the famed Sahm Rule, which signals the likely start of a recession when the current three-month moving average in the unemployment rate exceeds the lowest three-month moving average over the past year by half a percentage point or more. The current Sahm Rule reading is 0.53%, according to Fed data<\/a>, having surged from 0.43% in June.<\/p>\n While saying now is not the time to panic, Sahm, who serves as chief economist at investment firm New Century Advisors, also emphasized that recent trends in the labor market have looked weak, at best, and the triggering of her namesake rule is certainly cause for concern about what may lie ahead. After all, the Sahm Rule\u2019s accuracy rate is 100% going back to every recession since the early 1970s.<\/p>\n \u201cIt\u2019s been very accurate over time, so that shouldn\u2019t be dismissed,\u201d Sahm said, noting that \u201crecessions can build slowly, and then come quickly.\u201d<\/p>\n\n