If you've skipped ahead a few pages in reading the script for the U.S. economic slowdown, then the recent announcement that the national unemployment rate rose to 4.9 percent in August is no surprise to you. It takes longer for fluctuations in the economy to show up in the labor market, but that does not alter the certainty of their arrival.

Still, the news of the 0.4 percentage point jump in the national jobless rate will be seen by many as the first real sign that the slowdown that has gripped the U.S. economy since last fall is real. That reflects both the fact that the unemployment rate is the most closely followed economic indicator by the public at large, and that, for perhaps the first time, the effect of the slowdown is reaching home.

The irony is that just as these "lagging" indicators of our economic troubles show up with the bad news about what's already in the books, there are some "leading" indicators in the pipeline that give hope that the turning point for the economy may be near. The closely watched Purchasing Managers Index produced by the National Association of Purchasing Managers showed a slowing of the decline in manufacturing activity in August, with a mild uptick in new orders that should ultimately stimulate output.

But that news offers little hope for the increasing numbers of those whose livelihoods have been disrupted by the stagnation of the national economy, at least for now. The August employment report from the Bureau of Labor Statistics paints a gloomy picture of the U.S. economy as we begin the second half of the year.

The news was particularly unkind for manufacturing industries, whose payrolls shrank significantly for the ninth consecutive month. The 141,000 job decline was spread across virtually the entire spectrum of goods-producing industries, resuming a nine-month trend of accelerating job cuts that had finally paused in June.

But the services-producing side of the economy did little to pick up the slack in August. The formerly high-flying Business Services industries could only tread water, thanks to stagnation in temporary help and computer services industry hiring. Modest growth in social services and health services helped balance declines elsewhere in the economy, to produce an overall loss of 113,000 jobs.

The news for Indiana's labor markets was more mixed. The Department of Workforce Development's July estimate of the statewide unemployment rate was still a fairly low 3.9 percent, seasonally adjusted. But unadjusted rates in some of the state's major cities have crept above 5 percent, including the manufacturing-intensive Kokomo and Fort Wayne metropolitan statistical areas (MSAs). Unsurprisingly, manufacturing employment is down in 10 of the state's 12 MSAs from their levels of a year ago, led by double digit declines in Bloomington and Kokomo.

It will take some time before the expected rebound in the manufacturing economy shows up in the form of reduced layoffs or increased hours. Just as the job cuts have lagged the downturn in business, the re-hiring of laid off workers, should they in fact occur, will be further down the road as well. It’s a script that we've seen many times before in the Midwest in previous economic cycles, but its one many would like to forget.