The U.S. economy entered a recession a year ago this month, the panel that dates American business expansions said today.
The declaration was made by the cycle-dating committee of the National Bureau of Economic Research, a private, nonprofit group of economists based in Cambridge, Massachusetts. The last time the U.S. was in a recession was from March through November 2001, according to NBER.
“The committee determined that the decline in economic activity in 2008 met the standard for a recession,” the group said in a statement on its Web site. The 1.2 million drop in payroll employment so far this year was the biggest factor in determining that start of the contraction, the group said.
Federal Reserve policy makers at their last meeting predicted the economy will contract through the middle of 2009, in line with private economists’ forecasts. If correct, the recession would be the longest since the Great Depression.
“It is clearly not going to end in a few months,” Jeffrey Frankel, a member of the group and a professor at Harvard University, said in an interview. “We would be lucky to get done with it in the middle of next year.”
The contraction would be the second under President George W. Bush’s watch, making him the first U.S. leader since Richard Nixon to preside over two recessions.
I was late -- I thought the recession began in the 1Q of 2007.