Recession
A significant decline in economic activity lasting more than a few months, often defined as two consecutive quarters of negative GDP growth.
Definition
A recession is a significant, widespread, and prolonged downturn in economic activity, typically defined as two consecutive quarters of negative real GDP growth. The National Bureau of Economic Research (NBER) in the US officially determines recession dates, considering factors beyond GDP including employment, personal income, retail sales, and industrial production. Recessions are characterized by rising unemployment, reduced consumer spending, falling business investment, and tightening credit. The Great Recession (2007-2009) and COVID-19 recession (2020) are recent examples.
Example
“The US economy contracted in Q1 and Q2 2022 on a technical basis, leading to widespread recession debate, though official NBER determination requires broader analysis.”
Usage Examples
- 1
“The team applied recession best practices to improve their economics outcomes significantly.”
- 2
“Understanding recession is essential for anyone building a career in Finance.”
When & How to Use
Use 'Recession' when working in Economics contexts where a recession is a significant, widespread, and prolonged downturn in economic activity, typically defined as two consecutive quarters of negative real gdp growth.
- ▸Applying recession principles during a economics project or initiative
- ▸Explaining recession to a junior team member or stakeholder unfamiliar with Finance
- ▸Evaluating options or proposals using recession as a decision-making criterion
Etymology & Origin
The term 'Recession' derives from professional usage and entered Finance professional usage as the field formalised in the 20th century.
History & Evolution
The concept of recession has evolved alongside Finance. Early practitioners relied on informal methods; structured approaches emerged with the professionalisation of economics in the mid-20th century. Today, recession is a standard part of Finance practice globally.
Synonyms
- economic contraction
- economic downturn
- negative growth
- economic slowdown
Antonyms / Opposites
- economic expansion
- boom
- recovery
Images
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Related Terms
- gdp
- depression
- unemployment
- fiscal-policy