Goldman Sachs on Wednesday became the latest major U.S. brokerage to predict a recession in 2008, joining fellow heavyweights Merrill Lynch and Morgan Stanley in the call for an economic contraction. Among the many factors these market pros watch for among signs of a pending slowdown is the employment scene.

While last week’s government payrolls report shows U.S. economy still adding new workers, that growth rate slowed dramatically in December, and the unemployment rate rose to 5 percent, the highest since 2005. “The ‘true’ pace of employment growth is now probably about zero, if not below,” says Goldman Sachs chief U.S. economist Jan Hatzius.

Well before last week’s data, though, other employment indicators suggested the economy had taken a turn for the worse.

As the blue line shows on the chart, the length of time unemployed Americans are spending without work appears to have bottomed in December 2006 and has been lengthening ever since. Meanwhile, the brown line shows number of Americans on unemployment benefits hit a two-year high late last month. The chart shows that when these two indicators assume such a consistent upward trajectory, recession (shown by the gray bands) is near at hand.