Economists Predicted a Recession. So Far They’ve Been Wrong.
www.nytimes.com
A widely predicted recession never showed up. Now, economists are assessing what the unexpected resilience tells us about the future.

A widely predicted recession never showed up. Now, economists are assessing what the unexpected resilience tells us about the future.

The recession America was expecting never showed up.

Many economists spent early 2023 predicting a painful downturn, a view so widely held that some commentators started to treat it as a given. Inflation had spiked to the highest level in decades, and a range of forecasters thought that it would take a drop in demand and a prolonged jump in unemployment to wrestle it down.

Instead, the economy grew 3.1 percent last year, up from less than 1 percent in 2022 and faster than the average for the five years leading up to the pandemic. Inflation has retreated substantially. Unemployment remains at historic lows, and consumers continue to spend even with Federal Reserve interest rates at a 22-year high.

The divide between doomsday predictions and the heyday reality is forcing a reckoning on Wall Street and in academia. Why did economists get so much wrong, and what can policymakers learn from those mistakes as they try to anticipate what might come next?

Non-paywall link

  • MicroWave@lemmy.worldOPEnglish
    2914·
    10 months ago

    What’s your source?

    Recent December data shows unemployment rate at 3.7% with 199,000 added jobs:

    Nonfarm payrolls rose by a seasonally adjusted 199,000 for the month, slightly better than the 190,000 Dow Jones estimate and ahead of the unrevised October gain of 150,000, the Labor Department reported Friday. The numbers were boosted by sizeable gains in government hiring as well as workers returning from strikes in the auto and entertainment industries.

    The unemployment rate declined to 3.7%, compared with the forecast for 3.9%, as the labor force participation rate edged higher to 62.8%. A more encompassing unemployment rate that includes discouraged workers and those holding part-time positions for economic reasons fell to 7%, a decline of 0.2 percentage point.

    https://www.cnbc.com/2023/12/08/jobs-report-november-2023-us-payrolls-rose-199000-in-november-unemployment-rate-falls-to-3point7percent.html

      • MicroWave@lemmy.worldOPEnglish
        266·
        10 months ago

        Thanks for the link. If I’m reading it correctly, the total number of tech layoffs for the whole 2023 was 191,000, which is less than the 199,000 new jobs added in just the single month of December 2023?

        In 2023: More than 191,000 workers in U.S.-based tech companies (or tech companies with a large U.S. workforce) were laid off in mass job cuts.

      • EnderMB@lemmy.world
        3·
        10 months ago

        As someone that works in tech, it should be noted that many of those laid off were probably able to find work elsewhere. It’s a shitty market for tech right now, but there are jobs out there.

        The industry that is really struggling is recruitment. Many people that I spoke to that were laid off from Amazon are still struggling to find work a year after losing their jobs. If you build a career around hiring in tech, and the industry goes into layoff-mode for 16 months, there’s not much demand for your skills.

    • shalafi@lemmy.worldEnglish
      1926·
      10 months ago

      Give it up OP. No economy news is good enough for this crowd. It’s, uh, Biden, or billionaires, or Wall Street, or someone, trying to fool us.

      Inflation is well under control, yet the guy above you is bitching about skyrocketing prices. No, prices did not come back down, not yet anyway. Why would they?! Have they ever?! Saw something the other day that indicated prices might fall just a bit? In any case, deflation is generally a bad thing. And I mean bad for the general economy we all participate in, not just megacorp profits.

      See, lemmy interprets any positive financial news as, “All is well!” Gets mad.

      Fuck no all is not well, and anyone paying attention sees this. My #1 concern is rental prices. The buyers’ market may sort itself out eventually, usually does, but renters are taking a fucking of historic proportions. Home ownership has always been a path to savings, building wealth and retirement. Yet young people are calling bullshit, wanting to throw that out because they can’t get theirs. I get the anger, but call your reps, fight the good fight. This one is a big, big deal.

      I’m down for some legislation limiting corporations from owning $X properties, but the devil is in the details. And oh gods are there details. Plus, we gotta fight uphill against the rich and their lobbyists.

      You’re trying to bring positive news to young people with shit jobs who have watched every chance of a future yanked out from under them. I get the cynicism, I really do. But FFS, look at the poster below me decrying tech layoffs. He doesn’t understand that employment space, he’s getting angry reading headlines, has no experience or context.

      Those of us in the tech sector are used to it. We have the skills to run right out and get another good paying job. And we always get paid more. That sucks, but it’s also reality. And “thousands” ain’t much in a country of 333,000,000.

      Anyway, I’ve splatted enough BS. Going to work on fixing my house up a bit.

      • blazera@kbin.social
        175·
        10 months ago

        what kind of weird inflation rant it this. admitting that the price spikes are still around but inflation is under control, and that it’s actually a good thing that all the prices went up while my wages stayed the same, prices going down is a bad thing. No explanation, just because. Is it because the rich get less money to trickle down to us?