Mild U.S. Recession Forecast for 2024 (2024)

FAQs

What is the economic forecast for the 2024 recession? ›

Data for 2024 is a forecast. UN Trade and Development (UNCTAD) forecasts global economic growth to slow to 2.6% in 2024, just above the 2.5% threshold commonly associated with a recession. This marks the third consecutive year of growth below the pre-pandemic rate, which averaged 3.2% between 2015 and 2019.

A panel of economists expect this year to be characterized by faster growth, shrinking inflation and healthy job creation — a far cry from the widespread fears of a recession that marked 2023.

The research of the Federal Reserve Bank of New York, currently puts the probability of a U.S. recession before February 2025 at 58%, that's about as high as a forward-looking recession probability has been on this model since the 1980s.

Analysts project 11.5% earnings growth and 5.5% revenue growth for S&P 500 companies in 2024. Fortunately, analysts see positive earnings and revenue growth for all eleven market sectors this year.

Is Inflation Ever Going to Go Down? Our base case is that inflation will return to normal in the second half of 2024, even as real GDP growth remains positive in year-over-year terms. This is referred by economists as a “soft landing.”

Because a decline in disposable income affects prices, the prices of essentials, such as food and utilities, often stay the same. In contrast, things considered to be wants instead of needs, such as travel and entertainment, may be more likely to get cheaper.

Banking regulation has changed over the last 100 years to provide more protection to consumers. You can keep money in a bank account during a recession and it will be safe through FDIC and NCUA deposit insurance.

Avoid becoming a co-signer on a loan, taking out an adjustable-rate mortgage (ARM), or taking on new debt. Don't quit your job if you aren't prepared for a long search for a new one. If you own your own business, consider postponing spending on capital improvements and taking on new debt until the recovery has begun.

Summary: Nonfarm payrolls increased 303,000 jobs in March, but we expect the slowdown in job growth to renew. The unemployment rate averaged 3.8%; it's expected to rise mildly to 3.9% on average in 2024. Wage growth averaged 4.1% and should slow further.

Most worrying topics worldwide 2024

Inflation was the most worrying topic worldwide as of March 2024, with more than one third of the respondents choosing that option. Poverty and social inequality as well as crime and violence ranked second at 30 percent.

Will the economy recover in 2024? ›

Global recovery is steady but slow and differs by region

The baseline forecast is for the world economy to continue growing at 3.2 percent during 2024 and 2025, at the same pace as in 2023.

The good news is that recessions generally haven't lasted very long. Our analysis of 11 cycles since 1950 shows that recessions have persisted between two and 18 months, with the average spanning about 10 months.

US Recession Probability (I:USRPEM)

US Recession Probability is at 58.31%, compared to 58.31% last month and 57.77% last year. This is higher than the long term average of 14.71%.

Economists see brighter outlook for 2024. Here's why. Americans can expect ebbing inflation and a strong job market this year, according to the National Association for Business Economics.

Increased stress all around. One of the most prevalent ways that recessions affect the average person is simply that stress goes up. It doesn't matter if you're comfortable in your job security and have a hefty financial cushion, or if you're struggling to make ends meet and have $100 in your savings account.

According to the National Bureau of Economic Research (NBER), the average length of recessions since World War II has been approximately 11 months. But the exact length of a recession is difficult to predict. In general, a recession lasts anywhere from six to 18 months.

Last week's data revealed that Europe's mild recession ended with the first quarter of 2024. Two back-to-back gross domestic product (GDP) declines of -0.1% in the third and fourth quarters of 2023 were followed by growth of +0.3% in the first quarter.