The US economy is in an odd place. Jobs are plentiful and the stock market is at record levels, but businesses leaders are worried enough about the future to pull back on spending. President Donald Trump calls this the "greatest economy" ever, yet he's also demanding the US central bank inject more stimulus into the economy ASAP, something that typically happens only when a lot of yellow and red flags appear.

The overwhelming consensus among experts is that the US economy is slowing after a pretty hot 2018. But there's heated debate over how fast it's cooling. Some argue that by the end of this year the US economy is likely to look and feel a lot as it did in 2016: decent but not great. Others say the nation is likely to slip into a moderate downturn akin to those in 1990 or 2001. (The White House is adamant that there's no slowing).

The Washington Post asked top economic forecasters what metrics they are watching closely right now. Many pointed to seven key indicators that have done a decent job signalling recessions in the past: manufacturing purchases (PMI), trucking volumes, heavy truck sales, business capital spending, temporary hires, bank lending conditions (i.e., how easy it is to get a loan) and new claims for unemployment benefits.

The data reveal a cloudy outlook but only a few signs of a nasty storm. Manufacturing is the biggest red flag, a sector that makes up about 12 per cent of the economy. Trucking shipments and business spending are flashing some yellow lights, a reflection that executives are on edge. But hiring and banking lending still look solid - or even strong.

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"The message you hear from Fed Chair [Jerome H.] Powell and about everyone else is, 'we are waiting for the trend to become clear,' " said Peter Atwater, president of Financial Insyghts. "The danger is everyone plays catch up at once" if the trend starts to point down.

The big risk is if corporate anxiety over the trade war, weak growth abroad and the slowing manufacturing sector causes businesses to halt hiring in the United States in coming months, a shift that would probably spook Main Street and cause the almighty American consumer to pull back on spending. But a lot remains unclear. Here's a rundown of the key metrics.

1. Manufacturing (red flag) - There has been a sharp deceleration in manufacturing in 2019. Hiring has flatlined after having one of its best years last year since the late 1990s. Output is slowing, and, especially alarming, manufacturing sentiment has tumbled to levels that almost signal a recession.

Many economists closely watch the Purchasing Managers' Index, a survey of industry leaders by IHS Markit. When PMI is above 50 the economy is usually expanding. When it falls below 50, the economy is typically contracting. In June, the index fell to 50.1, the worst reading since 2009. The question is whether this weakness will spill over into other sectors or set up a situation similar to that in 2015, when manufacturing contracted but the services sector (technology, finance, hospitality, health care, etc.) remained solid.

2. Trucking (yellow to red flag) - Nearly every good sold in the United States touches a truck at some point, which is why trucking shipment data can be revealing. After a stellar 2018, shipments have plunged during the past six months, according to the Cass Freight Index.

"Bottom line, more and more data is indicating that this is the beginning of an economic contraction. If a contraction occurs, then the Cass Shipments Index will have been one of the first early indicators once again," said Donald Broughton, founder of Broughton Capital and the lead analyst for the Cass Freight Index.

But many truckers note that it would be tough to continue last year's levels, so it's hard to know how much to read into the annual decline. In 2018, companies were enjoying big tax cuts that spurred some extra purchases and trying to move goods before Trump's tariffs took effect.

3. Heavy truck sales (green light) - While trucking shipments look gloomy, another way to gauge the health of the trucking industry (and overall economy) is to look at sales of the big 18-wheeler trucks. That data looks a lot better, a seeming indication that the industry is still in a good enough place for companies to want to invest for the future.

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"So far, the data I am looking at does not suggest the economy is slowing," said Brian Wesbury, chief economist at First Trust Portfolios, who likes to watch large truck sales and initial jobless claims.

But Boris Strbac, owner of Star Trucking in Milwaukee, says a lot of trucking company owners wanted to buy trucks at the end of last year and couldn't get them until this year because of heavy demand. He expects sales to drop off. "I made a mistake. I bought four trucks not too long ago. I regret that now, believe me," he said.

4. Jobless claims (green light) - Hiring has been one of the strongest parts of the economy since 2014. Economists closely watch how many Americans file for unemployment insurance, because that data comes out weekly and is often the first indication of trouble.

New jobless claims remain low, but there has been a slight uptick recently, reaching a seven-week high on Thursday. Still, most economists say unemployment claims need to reach at least 250,000 a week before there's concern (the latest data out Thursday showed 227,000 new claims last week).

5. Temporary hires (green light) - Another way to gauge how eager companies are to hire people is to look at how many temporary employees they bring on. These workers are usually the first to go if there's any sign of a slowdown, since they are easy to let go and have few ties to the company or management.

US stocks continue a strong run. Photo / Getty Images
US stocks continue a strong run. Photo / Getty Images

The US Labour Department measures temporary hires monthly. So far in 2019, temporary hiring has slowed, compared with last year's, but it has yet to turn negative. Temp hiring appears to be consistent with the idea that the economy is slowing gradually this year but not nose-diving.

6. Business spending (yellow flag) - Business leaders are nervous, according to most metrics of sentiment in the corporate sector. But the question is how is that translating into decision-making? This year evidence is growing that companies are pulling back on investment spending.

Business typically taper their capital spending when they are less certain about the future, making it a closely watched economic gauge. Like temporary hires, business spending has yet to turn negative but it is showing a clear slowing path.

7. Bank lending (green light) - While many watch the daily gyrations of the stock market, a better gauge of how Wall Street and the broader economy are interacting is what's happening with bank loans. Economists pay close attention to whether banks are tightening lending standards, a sign of growing concern, or easing them.

Lately, banks have been easing lending standards, an indication that most banks don't think a big downturn is imminent.

Matthew Luzzetti, chief US economist at Deutsche Bank, says all of these mixed signs about the economy lead him to predict "a decline in domestic growth momentum in the second half of the year," but he is careful not to say "recession."