When Was the Last Recession in the US?

Review discussions on America’s most recent downturn, comparing the impacts and definitions of Covid-19 and the Great Recession. Analyze the significant effects of past economic crises on US policy and business approaches.

By Brad Nakase, Attorney

Email  |  Call (888) 600-8654

Have a quick question? I answered nearly 1500 FAQs.

There is a lot of debate about when was the last recession in the US. While there is no global definition of a recession, traditionally economists have considered a recession to be a significant and widespread economic decline that lasts for at least 6 months. However, the last recession in the US does not meet this definition, so economists disagree whether the Covid-19 Recession or the Great Recession was the last recession in the US.

A Recent History of US Recession

There have been 4 recessions in the United States over the last 30 years:

  • The Covid-19 Recession: (February 2020 – April 2020)
  • The Great Recession: (December 2007 – June 2009)
  • The Dot Com Recession: (March 2001 – November 2001)
  • The Gulf War Recession: (July 1990 – March 1991)

Not all economists agree on when was the last recession in the US because the Covid-19 recession was so short. Some believe it is so short that it doesn’t count as a recession. However, the NBER, the unofficial experts on recessions here in the States, believe it is a recession because of the huge impact it had on the economy.

Let’s look at the arguments on either side for when was the last recession in the US.

Was The Covid-19 Recession the Last Recession in the US?

The Covid-19 Recession in 2020 is the last recession in the US, according to the NBER. While there is no official expert on recessions, the NBER records economic data and is widely seen to be an expert on US recessions.

The NBER believes that the Covid-19 Recession was the last recession in the US. It didn’t last 6 months, but the impact on the economy was so great that the NBER decided it constituted recession status. In the US, the Covid-19 Recession led to some high recession statistics:

  • The unemployment rate peaked at 14.7%
  • 7% of global working hours were lost.
  • The GDP of the US dropped by 31.4%.

Every industry was affected during the Covid-19 Recession as people were told to stay home and tight restrictions were placed on those who had to physically attend work. Business production slowed down considerably. Companies had to adapt the way they did business and it was easier for some types of businesses than others.

The unprecedented amount of stimulus the government approved during the pandemic ($5 trillion pandemic relief) paired with businesses getting creative about how to operate during a lockdown prevented the Covid-19 Recession from being the most severe in history.

While the last recession in the US only lasted 2 months, it is believed that the severity of economic decline during those 2 months is why the NBER classified it as a recession.

Was the Great Recession the Last Recession in the US?

There is no debate over whether the Great Recession was a recession. It is considered one of the worst recessions in recent years. The Great Recession is considered by many to be the last recession in the US.

It officially lasted for 18 months, but it took 4 years for the US economy to recover to pre-recession levels.

The Great Recession was caused by the housing bubble bursting, which triggered a financial crisis that turned into a recession. Here are some of the recession statistics from the Great Recession:

  • The S&P 500 plummeted by 51%.
  • The unemployment rate peaked at 9.5%.
  • The US GDP dropped by 4.3%.

If you compare the recession statistics of the Great Recession to the Covid-19 Recession, you can see why the NBER decided the impact Covid-19 had on the economy while only lasting 2 months, making it worthy of a recession.

The Great Recession was felt most in the US, but many of the countries that do a lot of business with the US were impacted by the Great Recession. As with the Covid-19 Recession, the US government did issue stimulus checks to US households during the Great Recession, but a lot of their recession spending was tied up in bailing out financial institutions. As with the Covid-19 Recession, the Great Recession affected every single industry because the issue was a lack of demand. Households had just seen the value of their homes plummet, and many Americans lost their homes either through defaulting on bad mortgages or because their mortgage lender went under.

In Conclusion: When Was the Last Recession in the US?

Depending on whether you count the Covid-19 Recession as a recession, your answer for when was the last recession in the US may differ from others. Whether you believe the Covid-19 Recession or the Great Recession was the last recession in the US, they both had a significant impact on the US economy and changed the way we do things.

The Great Recession changed financial policy for the better, giving the government more oversight over financial practices. The Covid-19 Recession didn’t just affect the way we do business, more of our lives moved online. So no matter the answer, the last recession in the US changed our country.

Have a quick question? We answered nearly 2000 FAQs.

See all blogs: Business | Corporate | Employment Law

Most recent blogs:

What is a default judgment

What is a default judgment

A default judgment is issued when a defendant fails to respond to a lawsuit, allowing the plaintiff to win by default. Understanding this process is crucial for both parties involved in litigation.
What is a quitclaim deed

What is a quitclaim deed

Quitclaim deeds offer a quick way to transfer property ownership without guarantees, distinct from warranty deeds. Ideal for non-sale property transfers among family or into trusts, they require careful legal consideration.
Sole Proprietorship Business License

Sole Proprietorship Business License

Sole proprietorships offer simplicity and fewer formalities for new business owners, with benefits like no separate taxes. Remember, personal and business assets aren't distinct, impacting liabilities and the need for proper licensing.
What is the most important part of your business plan

What is the most important part of your business plan

The executive summary shines as the pivotal element of a business plan, serving as a decisive factor for readers to delve deeper. A comprehensive guide on crafting an impactful business plan, focusing on unique strategies and essential components.
Easy Businesses To Start

Easy Businesses To Start

Unleash your entrepreneurial spirit with these straightforward home-based business ideas, from e-commerce to creative pursuits. Embrace the flexibility and potential for financial independence with diverse options suited for various interests and investment levels.
What is the standard deduction

What is the standard deduction

Understand the IRS standard deduction, a straightforward option for reducing taxable income without needing detailed documentation. Delve into eligibility, amounts for 2023-2024, and considerations for itemizing versus standard deduction.
How to get a business license

How to get a business license

Grasp the essentials of obtaining a business license in California, focusing on local and state-level requirements. Uncover specifics on when and why different types of business licenses are needed.
Why Do Businesses Fail

Why Do Businesses Fail

Uncover the key factors contributing to small business challenges, including financial obstacles, inadequate management, and flawed marketing strategies. Understand the role of a comprehensive business plan in ensuring long-term success.
What is a BOC 3

What is a BOC 3

Understand the essentials of a BOC-3 filing for transportation businesses in California, detailing the designation of process agents for FMCSA certification. Learn the requirements, costs, and benefits of choosing the right process agent for your business.
Standard deduction vs itemized deduction

Standard Deduction vs Itemized Deduction

Understand the key differences between standard and itemized deductions to effectively reduce your taxable income and potentially save on taxes. Choose wisely to maximize your tax benefits based on personal financial details.
How to calculate net income

How to calculate net income

Unveil the significance of calculating net income for business profitability, a key indicator for financial health and decision-making. Understand the formula and practical applications for determining net earnings.
Itemized deductions

Itemized Deductions

Optimize your tax return by understanding the differences between itemized and standard deductions, crucial for minimizing tax liability. Learn the benefits and challenges of itemizing to make informed financial decisions.
What are intangible assets

What Are Intangible Assets

Discover the value of intangible assets like patents and trademarks in your business, crucial for strategic and financial planning. Learn how to manage and amortize these non-physical yet essential resources.
What is accounting

What Is Accounting

Understand the importance of accounting in monitoring financial activities and making informed decisions for your business. Gain insight into accounting fundamentals and its role in legal and tax matters.
Dysfunctional family

Dysfunctional Family

Explore the impact of growing up in a dysfunctional family, where constant conflict, neglect, and various addictions shape childhood experiences. Understand common traits, the consequences on children, and the cycle of unhealthy parenting behaviors.
When Was the Great Recession

When Was the Great Recession?

Delve into the Great Recession's timeline, an era of financial distress from December 2007 to June 2009. Understand the causes, including the 2007 housing bubble crash, and worldwide effects.
When Was the Last Recession in the US

When Was the Last Recession in the US?

Review discussions on America's most recent downturn, comparing the impacts and definitions of Covid-19 and the Great Recession. Analyze the significant effects of past economic crises on US policy and business approaches.
What to Invest in During a Recession- 4 Ideas

What to Invest in During a Recession: 4 Ideas

Uncover effective strategies for investing during a recession, assessing personal goals and current market situations. Examine four robust investment approaches to manage through economic declines effectively.
Will the US Get Hit with a Recession in 2024

Will the US Get Hit with a Recession in 2024?

Experts debate the likelihood of a 2024 US recession, analyzing factors like the yield curve and consumer confidence. Predictions vary, with a focus on interest rates and tech layoffs impacting the economy's future.
How Long Do Recessions Last

How Long Do Recessions Last?

Learn about typical US recession lengths and influencing factors, noting recent trends with shorter durations averaging 10 months. Investigate how external factors and government decisions affect recession timelines, comparing historical data.
When Will the Recession End

When Will the Recession End?

Economists predict a mild US recession with limited impact on employment and spending. The duration and impact of the recession depend on Federal Reserve policies and business cycle patterns.

When not to sign a severance agreement?

Do not sign a severance agreement if you do not understand it. By agreeing to a severance agreement, you give up your right to sue your employer. Remember, it is possible to negotiate the terms of your severance package. You are not required to sign a severance agreement.

How Do You Deal with a Toxic Business Partner?

Address concerns directly to the bad business partner; communicate openly and clearly. Consider mediation or seek legal advice from a business dispute attorney. Document disagreements, consider amicable separation if necessary.

Contact our attorney.

Please tell us your story:

0 + 4 = ?