Coronavirus recession started in February, US panel says

The US entered a recession in February as the coronavirus slammed the brakes on the nation’s longest economic expansion, the National Bureau of Economic Research said Monday.

The declaration from the influential panel of experts makes official what workers and investors have known for months: The pandemic sparked a historic economic downturn that unfolded at breakneck speed.

“The unprecedented magnitude of the decline in employment and production, and its broad reach across the entire economy, warrants the designation of this episode as a recession, even if it turns out to be briefer than earlier contractions,” the NBER’s Business Cycle Dating Committee said in a statement.

The bureau — a private nonprofit known for setting the guideposts of the US’s economic cycles — determined that the US economy reached a “peak” in February that was followed by massive job losses thanks to lockdowns meant to stem the spread of the coronavirus.

That brought an end to the 128-month expansion that began in June 2009, making it the longest since at least 1854. The previous record was the 120-month expansion lasting from March 1991 to March 2001, the NBER said.

A recession is often defined as two consecutive quarters of shrinking gross domestic product, or the value of all goods and services produced in a nation. But the NBER makes its calls based on a range of factors, primarily employment and domestic production.

Many economists expect the current recession to be intense but fairly short as most parts of the country have lifted the virus-related restrictions that froze the economy. The last declared recession started in December 2007 and lasted 18 months, according to the NBER.

“The committee recognizes that the pandemic and the public health response have resulted in a downturn with different characteristics and dynamics than prior recessions,” the bureau said in its statement.