US recession began in February amid coronavirus pandemic, ending longest expansion in history
- National Bureau of Economic Research, which made the official designation, cites ‘unprecedented magnitude’ and ‘broad reach’ of decline
- World Bank projects that international economic activity will shrink by 5.2 per cent this year, the deepest global downturn since end of World War II
The US economy entered a recession in February as the coronavirus pandemic struck the nation, a group of economists declared on Monday, ending the longest expansion on record.
The economists said that employment, income and spending peaked in February and then fell sharply afterward as the viral outbreak shut down businesses across the country, marking the start of the downturn after nearly 11 full years of economic growth.
A committee within the National Bureau of Economic Research, a trade group, determines when recessions begin and end. It broadly defines a recession as “a decline in economic activity that lasts more than a few months”.
For that reason, the NBER typically waits longer before making a determination that the economy is in a downturn.
During the previous recession, the committee did not declare that the economy was in recession until December 2008, a year after it had actually begun. But in this case, the NBER said the collapse in employment and incomes was so steep that it could much more quickly make a determination.