'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,' the NBER said.
New Jersey First Lady Tammy Murphy hands out bags containing meals, face masks and other personal protective supplies to residents in need outside the NAN Newark Tech World during the outbreak of the coronavirus disease in Newark, New Jersey, May 6, 2020.The worst U.S. downturn since the Great Depression is now officially a recession, according to the National Bureau of Economic Research.
"The committee recognizes that the pandemic and the public health response have resulted in a downturn with different characteristics and dynamics than prior recessions," the NBER's Business Cycle Dating Committee said in a statement.
As a rule of thumb, recessions are thought to entail two consecutive quarters of negative GDP growth. However, that isn't always the case, and it's generally the NBER's decision to determine recessions. U.S. GDP fell 5% in the first quarter and is likely to post the worst decline in history for the second quarter — possibly more than 50%.
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