The United States officially entered a recession in February 2020, the committee that calls downturns announced on Monday, June 8, 2020, marking the beginning of the first economic downturn since the 2007 to 2009 slump.
The National Bureau of Economic Research said that the economy hit its peak in February and had since fallen into a downturn, as pandemic-related shutdowns tanked activity and brought an end to a record-long expansion — one that had lasted 128 months.
Longest Expansion comes to an End
The sharp decline in economic activity in February marked the end of the longest expansion in the U.S. since at least 1854, according to the National Bureau of Economic Research. Here are expansions compared with G.D.P since the end of WWII.
Analysts often refer to recessions as two consecutive quarters of contraction. The National Bureau of Economic Research, a nonprofit group that tracks economic cycles in the United States, formally determines when recessions begin and end based on a range of factors, most importantly gross domestic product and employment. Most economists expect that this recession will be both deep and short, with growth rebounding as state economies reopen and the world figures out how to function amid the coronavirus pandemic.
“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 a statement.
Globally, “this is almost certainly the deepest recession” since at least the Second World War, Jan Hatzius, Goldman Sachs chief economist, wrote in a note on Monday. But it is also probably the shortest: He noted that the bureau’s database showed no other recession that had lasted less than six months in records dating back to the mid-1800s.
Most economists believe the recovery has already begun. On Friday, after weeks of data depicting enormous economic destruction, the Labor Department reported that the unemployment rate fell and employers added 2.5 million jobs in May. But tens of millions are still out of work, and the unemployment rate, which fell to 13.3 percent from 14.7 percent in April, remains worse than in any previous postwar recession.