"The committee has determined that apeak in monthly economic activity occurred in the U.S. economy inFebruary 2020. The peak marks the end of the expansion that beganin June 2009 and the beginning of a recession, said NBER in astatement. (Image: Shutterstock)

The National Bureau of EconomicResearch, the date-keeper for U.S. business cycles,has declaredFebruary 2020 as the official end of the U.S. economic expansion andbeginning of the current recession.

"The expansion lasted 128 months,the longest in the history of U.S. business cycles dating back to1854," according to the NBER. The previous record was 120 months, running fromMarch 1991 to March 2001.

The NBER noted that February 2020marked the peak for payrolls and the low in the national unemployment rate as wellas the spike in monthly real personal spending, "the mostcomprehensive monthly measure of aggregate expenditures," and inaggregate real income. The latter two contribute to quarterly GDPreports.

At the same time, the NBERacknowledged problems with the job data occurring during the earlymonths of the COVID-19 pandemic. The payroll data, based on a broadsurvey of employers, for example, overcounted workers "due tospecial circumstances associated with the pandemic of early 2020."Individuals on paid furlough were counted as employed even thoughthey weren't working, according to the NBER.

"The committee concluded thatboth employment series were … consistent with a business cycle peakin February," even though the payroll data and household surveymeasure employment only through the twelfth of the month. As aresult, the March jobs report, which the NBER considered in tryingto identify when employment peaked, understated "the collapse ofemployment during the second half" of the month, "as indicated byunprecedented levels of new claims for unemploymentinsurance." 

The NBER noted that the "pandemicand the public health response" have led to a "downturn withdifferent characteristics and dynamics than priorrecessions.

Nonetheless, it concluded thatthe unprecedented magnitude of the decline in employment and production, and itsbroad reach across the entire economy, warrants the designation ofthis episode as a recession, even if it turns out to be brieferthan earlier contractions."

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