The Economic Perspective: “The Definition of a Recession”

I’m Mary Walden with economist MW welcoming you to the economic perspective.  Today’s program looks at the definition of a recession.  Mike, you do about 75 talks each year around the state.   I imagine today you’re getting many questions about the possibility of a near-term recession.  But what really is the meaning of a recession?

  • Means economy is going in reverse
  • Fewer jobs, less selling, lower incomes and profits
  • Strict definition is the reversal must occur for two consecutive quarters
  • Actually, had a reversal in 2015, but only lasted for one quarter, so not an official recession
  • Recession is different than an economic slowdown
  • Slowdown means still improving, but at a slower rate
  • Most economists think we are now in a slowdown, not a recession
  • But slowdowns can ultimately become recessions
  • I’m MW

And I’m Mary Walden for the Economic Perspective, an NC State Extension program from the Department of Agricultural and Resource Economics.