We've just cleared the first quarter of 2003, and by every indication, the U.S. economy has experienced a very bumpy ride. From the reports on employment, industrial activity, and retail sales, there have been very few safe harbors from the stagnation that descended over businesses and consumers alike. That's a concern not just for the President and the chairman of the Federal Reserve, but for every other industrialized nation that has been hoping to ride the U.S. economic growth engine to spark their own economic recoveries.

We have plenty of depressing data to examine concerning the last few month's activity in the U.S. economy. What we lack is the perspective to be able to decipher its true meaning. If it depicts a short-lived pause in activity as businesses and consumers hold back for international tensions to ease and usher in a return to normalcy, then we may yet see 2003 hit its growth targets. But if it is the beginning of a new downturn, this time led by consumer spending, then all bets made last November for the economy are off.

The Bureau of Labor Statistics report on employment growth in the national economy in March raises the very real possibility that the economy failed to grow during the first three months of the year. We'll have a better handle on that in a few weeks, when the preliminary estimates of Gross Domestic Product are released, but the job reports from BEA certainly paint a picture of decline.

The level of payroll employment fell by 108,000 jobs last month, according to BEA's preliminary estimates. That's less than the downwardly revised loss of 357,000 jobs the month before, true. But it puts the total job tally about 264,000 down from the close of 2002.

That translates into less fuel for consumer spending growth. If job cuts come in sectors with below average pay, or there is enough earnings growth for those lucky enough to hang onto their jobs, consumer spending could keep its growth streak alive in the face of these setbacks. However, the data so far suggest that not only is aggregate personal income growth faltering, but consumers are becoming more reluctant to spend the income they do receive.

Those trends are of deep concern to consumer good-oriented businesses that have thus far managed to avoid the pain of recession felt by others. The reaction of the domestic auto industry has been to open the spigot of zero-rate financing even wider, and for the first time they have joined by some foreign carmakers in the discounting.

Of course, for the economy as a whole, a sustainable recovery cannot be crafted by simply eating into future sales. Here the data on the economy paint a picture that is a little brighter. By all appearances, the fragile, yet positive, growth in business spending that began in the second half of 2002 has remained intact. In particular, the hard-battered business equipment industries, some of which have an important presence in Indiana, are beginning to see new orders as other businesses begin to slowly add capacity.

Even if the table is set for sustainable growth, if consumer spending doesn't rebound from the first quarter doldrums, the economic growth engine of the U.S. economy will soon be sputtering to a halt. The next few months will tell us whether a new, more dismal, script must be written for the economy of 2003.