February marked the end of a record period of growth in the U.S. as the coronavirus rapidly spread, the National Bureau of Economic Research said in a statement Monday.
Large decreases in both domestic production and employment as a result of the hundreds of thousands of businesses closures across the nation to reduce the spread of COVID-19 led the NBER to designate the current economic contraction as a recession, the NBER said.
Though the standard that usually determines the beginning of a recession is two consecutive quarters of economic contraction, the NBER said that the nature of the pandemic gave the current recession different dynamics than recessions in the past.
“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 organization said in its statement.
The start of the recession in February marked the end of the longest period of economic expansion, which began in June 2009, according to the NBER.
The news came as the World Bank estimates that the global economy will contract by over five percent in 2020, marking the most severe recession since World War II, according to a statement also released Monday.
While the recession is the most severe in generations, the NBER has remained optimistic that it will be relatively short as the economy begins to rebuild and employees begin to go back to work and operate in cleaner, socially-distanced ways.