The Economy Grew in 2022. Are Experts Still Predicting a Recession in 2023?
AllSides Summary
Thursday’s robust economic growth report led some analysts to scale back their predictions for a recession this year. Most, however, still think at least a “mild recession” is likely.
For Context: The Bureau of Economic Analysis reported Thursday that real (inflation-adjusted) U.S. GDP grew 2.9% in the fourth quarter of 2022, pulling the year’s overall growth up to 2.1%. While the first two quarters of 2022 saw negative growth, those contractions were relatively smaller than past recessions: -1.6% and -0.6% versus Q4 2008’s -8.5%. Despite the economy’s growth in the second half of 2022, most Americans still believed the U.S. was in a recession. That belief could become reality in 2023, according to many economists. The Federal Reserve’s anti-inflation interest rate hikes have raised the cost of borrowing, cooling business activity and the previously-hot housing market. Sensing a downturn, tech companies that hired extensively during the COVID-19 pandemic are now laying off thousands of workers.
What Media Voices Are Saying: Commentators across the spectrum generally agreed that while 2022’s growth was good news, the economy still faced a likely recession. However, voices disagreed on how mild or severe the downturn would likely be; some voices from the right focused on potential warning signs.
Featured Coverage of this Story
From the Left
How will we know if the US economy is in a recession?
The second consecutive quarter of economic growth that the government reported Thursday underscored that the nation isn’t in a recession despite high inflation and the Federal Reserve’s fastest pace of interest rate hikes in four decades.
Yet the U.S. economy is hardly in the clear. The solid growth in the October-December quarter will do little to alter the widespread view of economists that a recession is very likely sometime this year.
For now, the economy expanded at a 2.9% annual rate in the fourth quarter, though some of the underlying figures weren’t as...
From the Center
Recession Odds: Still High—But Forecasts Better Than Expected
Inflation has begun to ease and economists are weighing the odds of the possibility of a recession in 2023—and while it still seems likely, it’s not nearly the sure bet it seemed just months ago.
A recession is defined by the National Bureau of Economic Research (NBER)—the official recession scorekeeper—as “a significant decline in economic activity that is spread across the economy and that lasts more than a few months,” though economists also believe two consecutive quarters of negative economic growth constitute a technical recession.
While the NBER can use indicators to...
From the Right
GDP report reveals ominous Great Depression warning sign not seen since 1932
The latest numbers from the Bureau of Economic Analysis show that the U.S. economy grew by 2.9 percent in the fourth quarter of last year, and 2.1 percent for 2022. While the White House was quick to take credit for the state of the nation’s economy, they might want to think twice. This latest report should have alarm bells ringing, not trumpets sounding.
That’s because economic growth is slowing down. Even the areas which contributed positively to gross domestic product (GDP) are not necessarily signs of prosperity. For example, business investment grew at only...
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