The March jobs report came in at 178,000 — nearly triple the forecast. CEOs who panicked over February’s 133,000-job loss are now exhaling. Two months, two opposite emotions, same mistake.
Employment data is a lagging indicator. It trails the real economy by six to nine months. What showed up in March isn’t a signal about where your business is heading — it’s a reflection of decisions companies made in the second and third quarter of last year. You’re not reading a forecast. You’re reading a receipt.
ITR Economics doesn’t use labor data to forecast for exactly this reason. If you’re making hiring plans, capital investments, or operational bets based on the jobs report, you’re driving using last week’s traffic report.
So what should you watch? Leading indicators — US Industrial Production rate of change, new orders, capital goods shipments. These move six to twelve months ahead of the curve. ITR’s current read: 1.5% industrial growth in 2026, with leading indicators pointing to acceleration in early 2027. That’s a useful planning signal. A monthly jobs number is not.
Meanwhile, PwC’s latest survey shows 68% of executives planning price increases in the next six months and small importers facing $500K+ in tariff costs. That pressure doesn’t show up in employment data yet — but it will, six to nine months from now, when it’s too late to adjust.
The CEOs I work with don’t plan off trailing data. They pressure-test assumptions against leaders who’ve been through cycles and know the difference between a headline and a leading indicator.