Leading vs. Lagging Indicators

Leading indicators are metrics that predict future economic or business trends, helping you anticipate changes before they happen—like new job postings suggesting upcoming economic growth. Lagging indicators, on the other hand, measure past performance and confirm trends after they've occurred, such as unemployment rates showing what has already happened. Together, they provide a fuller picture: leading indicators help in planning and decision-making, while lagging indicators validate the outcomes of previous actions. Understanding both helps businesses and policymakers make informed choices about the future.