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Are Predictions Of A Recession Overstated?

Two people in business attire ascending on an escalator.
Alex Proimos
Flickr.com/proimos (cc by-nc 2.0)

A new report from the Illinois General Assembly suggests concerns about the economy might be overblown.

It’s been more than 10 years since the end of the Great Recession, and the economy is still in the largest expansion in American history.

But predictions of another downtown are in the air:

“You guys say we might get a recession in a couple years.” “Yes, that’s the risk.” — Sabri Ben-Achour to Henry Curr on Marketplace
“I think it’s highly probable. I do have a recession in 2020.” — Diane Swonk on Fox Business
“I still think we’re headed towards a recession.” — Hugh Johnson on CNBC

Those predictions will come true — someday. But the latest report from the Illinois legislature’s bipartisan Commission on Government Forecasting and Accountability asks: Is there too much worry?

Yes, the report suggests, the economy is “doing fine — for now.”

The national unemployment rate remains near its lowest level since 1969, and the report says October’s job growth was solid — especially in light of the long autoworkers strike at GM.

Beyond that, the all-important consumer spending figure is growing, too. In Illinois, there were 60,973 new car and truck registrations in September, up 30 percent from a year prior.

Despite those figures, there is still uncertainty over trade policy and a slowdown in global growth.

Ultimately, the report says, “it is impossible to predict the precise timing of the next recession.”

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