A significant, extended, and pervasive downturn in economic activity is referred to as a recession. So, how many recessions has the US had? Let's find out!
What Is A Recession?
Two consecutive quarters of real Gross Domestic Product (GDP) contract, which quantifies the total value of all the goods and services generated in an economy, are commonly used to characterize recessions.
A recession in the United States is described by the National Bureau of Economic Research (NBER) as "a significant decline in economic activity that is spread across the economy and lasts more than a few months." Based on variables such as GDP, payroll employment , personal income and consumption, industrial production, and retail sales, the NBER assigns dates to recessions.
How Many Recessions Has The US Had?
Since the Great Depression, there have been 14 declared recessions in the United States, and they have also occurred in other nations, demonstrating that these downturns are a recurring aspect of the global economy.
After 1933, a recovery from the Great Depression was ensured thanks to expansionary monetary and fiscal policies, albeit a patchy and unfinished one. Policymakers altered course in 1936–1937, being more concerned with reducing budget deficits and preventing inflation t han with the risks of a depressed relapse.
In March 2020, the COVID-19 epidemic reached the United States. As a result of the ensuing travel and employment restrictions, employment fell pregnant, ushering in an exceptionally brief but severe recession. The unemployment rate increased from 3.5% in February 2020 to 14.7 % in April 2020, but after $5 trillion in pandemic relief spending, it dropped back to around 4% by the end of 2021.
Along with a federal funds rate that remained close to zero until March 2022, the Federal Reserve's quantitative easing program increased its balance sheet from $4.1 trillion in February 2020 to over $9 trillion by the end of 2021.
What Is The Average Length Of A Recession?
According to the NBER, there have been 34 recessions in the United States since 1857, with durations ranging from two months (February to April 2020) to more than five years (October 1873 to March 1879). The six recessions since 1980 have averaged fewer than 10 months in length compared to the average recession duration of 17 months.
Summary
How many recessions has the US had? The answer is 14. The majority of recent recessions have been brought on by a combination of increasing energy prices, declining budget deficits, and rising interest rates.
