The U.S. economy officially entered into a recession in February, according to the National Bureau of Economic Research, ending the record 128-month expansion that began in June 2009.
The Business Cycle Dating Committee, which tracks and dates business cycles within the NBER, said the economy peaked in February before the coronavirus pandemic spread throughout the country and prompted an unprecedented shutdown in economic activity. Recessions often refer to two consecutive quarters of contraction, but the NBER’s formal calculation includes other factors, including domestic production and employment.
“The time that it takes for the economy to return to its previous peak level of activity or its previous trend path may be quite extended,” the committee’s report said.
Economists frequently point to mid-March as the launching point for sweeping layoffs and frozen consumer spending as people cleared out of stores, restaurants, offices and travel to avoid the virus’s spread. Now, as states gradually ease restrictions, the question will be whether “reopening” fuels an economic turnaround anytime soon, or whether the downturn will extend into next year as people struggle to go back to work and the nation contends with a possible second wave of infections.
(c) 2020, The Washington Post · Rachel Siegel