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Why economists talk about a recession
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A job advertisement in the window of a Los Angeles restaurant in February. A majority of forecasters say a recession is unlikely in the next year.
PHOTO: AFP
Ben Casselman
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(NYTIMES) - Rapid inflation, soaring oil prices and global instability have led forecasters to sharply lower their estimates of economic growth this year, and to raise the probabilities of an outright contraction. Investors share that concern: the bond market recently flashed a warning signal that has often - though not always - foreshadowed a downturn.
Such predictions may seem confusing when the economy, by many measures, is booming. The United States has regained more than 90 per cent of the jobs lost in the early weeks of the pandemic, and employers are continuing to hire at a breakneck pace, adding 431,000 jobs in March alone. The unemployment rate has fallen to 3.6 per cent, barely above the pre-pandemic level, which was itself a half-century low.
