Looking for Hopeful Economic Signs

In an economic update to Congress on May 5, Federal Reserve Chairman Ben Bernanke noted that "recent data suggest that the pace of contraction may be slowing."

Is the Southeast experiencing a slowing in economic contraction? For answers to that question, Atlanta Fed economists and analysts look at many indicators and gather insights from regional business contacts.

Although employment data tend to lag real developments in the economy, information on initial claims for unemployment insurance provides clues about potential labor market stabilization. If the number of workers signing up to receive unemployment insurance for the first time is leveling off or decelerating, that trend could indicate that fewer people are losing their jobs and could signal that the pace of overall economic contraction is slowing.

The data appear to show that the pace of initial unemployment claims could indeed be stabilizing in the Southeastern states. …

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