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Monthly Insights To Help You Stay In Front Of The U.S. Business Cycle

ClearBridge Investments, a specialist investment manager of Franklin Templeton, designed the Anatomy of a Recession (AOR) program to deliver thoughtful perspective on the state of the US economy with concise, practical views updated every month. Our exclusive recession risk and recovery dashboards provide the statistical foundation of our perspective. Watch the video to hear more about the program from Investment Strategist Jeff Schulze. and use the tabs below to explore the current market views.

  • Recession Risk
  • Recession Risk by Comparison
  • Case Study

Recession Risk

Recession Risk

U.S. Recession Risk Indicators
    September 30, 2025 June 30, 2025 March 31, 2025
Consumer
 Housing Permits Caution Expansion Expansion
Job Sentiment Recession Recession Recession
Jobless Claims Expansion Expansion Expansion
Retail Sales Expansion Expansion Expansion
Wage Growth Expansion Expansion Expansion
Business Activity
 Commodities Expansion Expansion Expansion
ISM New Orders Caution Recession Recession
Profit Margins Caution Caution Expansion
Truck Shipments Expansion Expansion Caution
Financial
 Credit Spreads Expansion Expansion Expansion
Money Supply Expansion Expansion Expansion
Yield Curve Caution Caution Recession
  Overall Signal Expansion Expansion Expansion

 

Expansion Expansion    Caution Caution   Recession Recession

 

A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. A recession begins just after the economy reaches a peak of activity and ends as the economy reaches its trough. Between trough and peak, the economy is in an expansion. Expansion is the normal state of the economy; most recessions are brief and they have been rare in recent decades.
Data as of September 30, 2025
Source: ClearBridge Investments, BLS, Federal Reserve, Census Bureau, ISM, BEA, American Chemistry Council, American Trucking Association, Conference Board, and Bloomberg. The ClearBridge Recession Risk Dashboard was created in January 2016. References to the signals it would have sent in the years prior to January 2016 are based on how the underlying data was reflected in the component indicators at the time.

Recession Risk by Comparison

Recession Risk by Comparison

U.S. Recession Risk Indicators
    Current 2020 2007-2009 2001 1990-1991 1981-1982 1980 1973-1975 1969-1970
Confidence
 Housing Permits Caution Expansion Recession Caution Recession Recession Recession Recession Recession
Job Sentiment Recession Caution Recession Recession Recession Recession Caution Caution Caution
Jobless Claims Expansion Expansion Caution Recession Recession Recession Recession Expansion Recession
Retail Sales Expansion Expansion Recession Recession Recession Recession Recession Caution Recession
Wage Growth Expansion Recession Recession Recession Recession Recession Recession Recession Recession
Economic
 Commodities Expansion Expansion Recession Recession Recession Recession Caution Caution Caution
ISM New Orders Caution Caution Recession Recession Recession Recession Recession Recession Recession
Profit Margins Caution Recession Recession Recession Recession Recession Recession Caution Recession
Truck Shipments Expansion Expansion Caution Recession Recession Recession Recession n/a n/a
Financial
 Credit Spreads Expansion Expansion Recession Recession Recession Recession Recession Expansion Caution
Money Supply Expansion Expansion Recession Recession Recession Recession Recession Recession Recession
Yield Curve Caution Recession Recession Recession Recession Recession Recession Recession Recession
  Overall Signal Expansion Caution Recession Recession Recession Recession Recession Caution Recession

 

Expansion Expansion    Caution Caution   Recession Recession
 

Data as of September 30, 2025
Source: FactSet, Bloomberg, Conference Board, Census Bureau, Federal Reserve, FRBPA, Chicago Fed, ISM, Dept. of Labor, Bloomberg/Barclays, AAII, Investors Intelligence, and Moody’s.

Case Study

Case Study

1990 Recession

 

    Q2 1988 Q4 1988 Q2 1989 Q4 1989 Q2 1990
Consumer
 Housing Permits Caution Expansion Caution Caution Recession
Job Sentiment Expansion Expansion Expansion Recession Recession
Jobless Claims Expansion Expansion Expansion Recession Recession
Retail Sales Expansion Expansion Expansion Caution Recession
Wage Growth Recession Recession Recession Recession Recession
Business Activity
 Commodities Expansion Expansion Caution Recession Recession
ISM New Orders Expansion Expansion Recession Recession Recession
Profit Margins Expansion Expansion Expansion Caution Recession
Truck Shipments Expansion Caution Recession Recession Recession
Financial
 Credit Spreads Expansion Expansion Caution Recession Recession
Money Supply Caution Recession Recession Recession Recession
Yield Curve Expansion Expansion Recession Recession Recession

 

Source: S&P, FactSet, NBER, and Bloomberg.

U.S. Recession Risk Interactive Dashboard

ClearBridge Investments utilizes twelve different economic indicators to assess the risk of recession. This interactive version of our exclusive Recession Risk Dashboard allows you to vary the settings for each indicator based on different scenarios that reflect your own views of future conditions.

  • Each indicator is set to reflect the Dashboard’s current positioning, which is updated monthly, using the most recent data available.
  • Slide the toggle for each indicator left or right to test the market impact of your own “what-if” scenarios.
  • Click the icon next to each indicator for more information about the individual indicator.

Note each individual indicator can signal expansion, caution or recession in the economy. The signals from each of the twelve indicators are combined into an overall dashboard signal of green, yellow or red. The indicators, signals and changes are based on the ClearBridge interpretation of the data and analysis. The data is supplied by ClearBridge Investments, a Franklin Templeton subsidiary. The ClearBridge Recession Risk Dashboard is not a crystal ball, but can serve as a tool to evaluate the risk of recession in the U.S. economy.

Financial

Yield Curve

Cycle Highs Steepens Further Modestly Steeper Stable Inversion

Credit Spreads

Stable Modest Widening Widen Material Widening Substantial Widening

Money Supply

Substantial Growth Material Increase Increase Stable Lower

Inflation

Wage Growth

Stable Modest Increase Increase Material Increase Substantial Increase

Commodities

Strengthen Stable Slightly Weaken Weaken Material Weakness

Consumer

Housing Permits

Substantial Pickup Modest Improvement Stable Slightly Weaken Weaken

Jobless Claims

Stable Modest Increase Increase Material Increase Substantial Increase

Retail Sales

Material Improvement Improvement Stable Slightly Worsen Worsen

Job Sentiment

Cycle Highs Material Improvement Improvement Slight Improvement Stable

Business Activity

ISM New Orders

Cycle Highs Substantial Improvement Improvement Stable Worsen

Profit Margins

Prior-Cycle Highs Stable Modest Contraction Contraction Substantial Contraction

Truck Shipments

Cycle Highs Material Improvement Modest Improvement Stable Decline

The current dashboard is updated by ClearBridge Investments as of 9/30/2025

All investments involve risk, including loss of principal. Past performance is no guarantee of future results.

Any information, statement or opinion set forth herein is general in nature, is not directed to or based on the financial situation or needs of any particular investor, and does not constitute, and should not be construed as, investment advice, forecast of future events, a guarantee of future results, or a recommendation with respect to any particular security or investment strategy or type of retirement account. Investors seeking financial advice regarding the appropriateness of investing in any securities or investment strategies should consult their financial professional.

Resources

Anatomy of a Recession Presentation

This comprehensive presentation provides an extensive current market and economic overview, as well as additional content on other relevant themes.

Download
INSIGHTS

Explore Clearbridge Insights

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NOVEMBER 3, 2025

AOR Update: Data dearth and the dashboard

ClearBridge Investments believes the probability of a pickup in layoffs tipping the economy into a recession remains low. They remain confident that US economic growth will continue to moderate but stay on a healthy trajectory.

OCTOBER 20, 2025

AOR Update (Podcast): Bubble or Boom?

On this month’s Talking Markets podcast, Jeff Schulze of ClearBridge Investments discusses the potential for Fed interest-rate cuts and why he's leaning a bit hawkish. He also compares today's market dynamics to the late 1990s tech boom and shares his thoughts on the Magnificent Seven and global equity performance.

OCTOBER 10, 2025

The Long View: Bubble or boom?

Whether a stock market bubble is forming has become a key debate for investors. ClearBridge Investments believes a boom may be ahead, driven by a favorable policy mix and a healthy consumer supporting earnings growth.