On the heels of inflation (or as the Republicans called it in the midterms “the sky is falling”), we are now hearing the term “recession”. Technically, “recession” means that we have two or more consecutive quarters without the growth of our Gross Domestic Product. Considering that we are experiencing inflation, higher interest rates, a worldwide COVID pandemic, serious supply chain disruption and an on-going expensive war between Ukraine and Russia, we think recession is probably a real concern. But, as they say, the devil is in the details. Why do we fear recession? The answer is that a stagnant economy cannot absorb all the graduates of all the schools who come out looking for jobs. But this economy doesn’t seem to have this problem–yet. Again, technically, Full Employment is considered 4% unemployed in the country. The theory is that–at any one time–4% of job seekers are between jobs when the measurement is taken. So the economists conclude that everyone who wants a job either has a job or is on their way to a new job. Where are we now? Our US unemployment rate is 3.7%. This means that we are at the point where very few people are unemployed. Another measure of employment is the number of first time unemployment benefit applications. This is also down significantly. And these numbers are not likely to change negatively during the holiday season when many companies hire seasonal help. So–at least for the present–take worries about recession off your stress list. Recessions are toothless if everyone who wants a job can get a job. And that’s what we have for the foreseeable future.
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