If the past is, indeed, prologue, then the recession should end sometime in 2009.
Now that the National Bureau of Economic Research confirms that we are in one — and have been since December 2007 — some recession facts and figures seem appropriate.
As the chart shows, the longest post-World War II recessions have lasted 16 months. The average has been 10.4 months, which means this recession already is longer than average.
Here, culled from a bureau fact sheet, is some minutiae on economic downturns:
• What is a recession? The standard news media definition is two consecutive quarters of negative growth in the Gross Domestic Product. The bureau says its own definition is more inclusive: “a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in production, employment, real income and other indicators.”
• Why did it take 12 months to identify it? The bureau, a private organization charged with dating the starts and conclusions of economic downturns, says it typically waits six to 18 months — “long enough so that the existence of a recession is not at all in doubt.”
• What is a depression? The bureau doesn’t define a depression, but acknowledges that the common definition is “a particularly severe period of economic weakness.” The term, the bureau says, is commonly used to describe the contractions that began in 1929 and in 1937. Both were “very severe,” and the 1929 downturn still is known as the “Great Depression.”
On the key question, however, the bureau takes a cop-out.
Q: How long will this recession last?
A: “The committee does not forecast.”
This article originally appeared in the January 2009 issue.