NewsBeat

September 2022 NewsBeat 9 percentage point from the advance to the third estimates. 3. Mention the role NBER plays in deter- mining a recession and remind audiences that two consecutive quarters of negative growth does not necessarily equal a reces- sion. It's not a recession unless the Business Cycle Dating Committee of the National Bureau of Economic Research says it is. The nonprofit economic research organization, based in Cambridge, Mass., determines when recessions start and end. Its purpose is to establish the historical record for recessions, not to rush to say whether or not the U.S. economy is currently in one. The White House calls the Business Cycle Dating Committee the "official recession scorekeeper." The committee is made up of eight aca- demic economists. They define a recession as "a significant decline in economic activ- ity that is spread across the economy and that lasts more than a few months." The committee waits for preliminary data to settle before making their determinations. "I think another really important point is that the NBER does not just look at GDP, but at a range of variables — including un- employment," Michael Klein, an economist at Tufts University and founder of Econo- fact, tells us by email. The exact process is opaque, but the data the committee analyzes also includes "real personal income less transfers, non- farm payroll employment, real personal consumption expenditures, wholesale-retail sales adjusted for price changes, employ- ment as measured by the household survey, and industrial production." The committee refers to the start of a recession as the economy's "peak" and the end of the recession as its "trough." The thing for journalists to relay to their audiences is that two consecutive quarters of negative growth does not necessarily equal recession, especially when other economic indicators remain strong. That said, the last time there were two consec- utive quarters of GDP contraction that didn't overlap with a recession was in 1947, according to Bureau of Economic Analysis data. But again, this is a peculiar time for the U.S. economy. As many others have point- ed out, current big picture economic data other than GDP points to a healthy econo- my. The unemployment rate, at under 4%, remains historically low. Consumer spend- ing is also in positive territory. At the same time, inflation is running well above the Federal Reserve's inflation target. The data are mixed, but not clearly point- ing to a recession. Going back to the early 1960s, Klein points out that there has not been a recession with the unemployment rate as low as it is now. 4. Remember that many people care about their household finances more than whether the U.S. is officially in a reces- sion. Individual experiences will vary widely from what aggregate data shows. Journal- ists can offer nuanced perspective on what is happening economically in their coverage area, aside from what is happening at the national level. Timothy Taylor, managing editor of the Journal of Economic Perspectives and author of the Conversable Economist blog, put it like this in an email to The Journal- ist's Resource: "The value-added of journal- ism is context and background." Consider food and fuel prices. In mak- ing decisions on interest rates, the Federal Reserve keeps a close eye on an inflation measure called core Personal Consumption Expenditures, which excludes food and fuel prices. Costs for food and fuel can swing wildly, so the central bank doesn't usually consider those prices as an accurate indica- tion of overall economic conditions. Still, as many people in the U.S. have experienced in recent weeks, fuel prices can affect a household's bottom line month to month. If more money is going toward fueling up the family cars, households may cut back on higher cost items elsewhere, in- cluding spending less at the grocery store. "For the average person, whether real GDP is a few tenths on the positive or the negative won't be perceptible, but whether their wages are falling behind inflation is quite clear," Taylor adds. Reprinted from The Journalist's Resource. Clark Merrefield joined The Journalist's Resource in 2019 after working as a report- er for Newsweek and The Daily Beast, as a researcher and editor on three books relat- ed to the Great Recession, and as a federal government communications strategist. He was a John Jay College Juvenile Justice Jour- nalism Fellow and his work has been award- ed by Investigative Reporters and Editors. Steve and P.J. D'Angelo of North Sea Hardware in Southampton help customers. Photo by Dana Show. Re- published courtesy of the Express News Group. .

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