The National Bureau of Economic Research announced Monday that a recession began in February of this year, marking the end of the longest period of economic growth in history.
“The unprecedented magnitude of the decline in employment and production, and its broad reach across the entire economy, warrants the designation of this episode as a recession, even if it turns out to be briefer than earlier contractions,” the bureau said in its report.
The bureau’s definition of a recession is a decline in economic activity that lasts more than a few months. The bureau is a private nonprofit research organization that is known for providing start and end dates for recessions in the United States.
The NBER determined that a peak in monthly economic activity occurred February, which marked the end of a period of growth that began in June 2009 after the Great Recession. The growth lasted 128 months, the longest in the history of U.S. business cycles dating back to 1854.
To determine February as the date of the monthly peak and the beginning of the recession, the bureau considered a number of indicators of domestic employment and production.
To calculate whether a recession is occurring, the bureau also weighs the depth of the downturn, its duration, and whether economic activity declined broadly across the economy.
The bureau attributed the cause of the recession to the coronavirus pandemic and ensuing economic shutdown. It also said that since the recession is tied to the public health response, the downturn has different characteristics and dynamics than prior recessions.
Some economists, including those in the Trump administration, fear that the economy will not enjoy the sharp, “V-shaped” recovery out of the recession predicted by President Trump but will rather face a slow, bumpy one arrested by any further outbreaks — a “W-shaped” recovery.
