Economist Mark Zandi thinks the US economy is on the brink of a recession, and there are a few signs he says that will show one has arrived.<\/p>\n
He delivered his dire warning about the state of the economy<\/a> last week, and followed it up over the weekend with a series of posts on X about what he’s eyeing to know if the economy has tipped into a downturn.<\/p>\n The topic of recession is heavily debated, with economists consistently deliberating over what qualifies. While the US is not yet in a technical recession\u2014defined as two straight quarters of negative growth\u2014other areas like the labor market<\/a> have been sounding a warning.<\/p>\n Zandi noted in his post that historically, the answer to exactly what signifies a recession is not always clear until after circumstances have shifted. However, in the thread, he laid out a few key factors:<\/p>\n Payroll employmentEmployment levelsJob decline consistency<\/p>\n He said that the National Bureau of Economic Research (NBER) is considered the arbiter of when a recession begins and ends, noting one key factor that its academic researchers consider above others. <\/p>\n “While they look at a plethora of data to make this determination, most importantly, far and away, is payroll employment,” he stated, adding that if employment falls for more than a month consecutively, the economy has entered a downturn.<\/p>\n Zandi said that payroll employment has not fallen yet but added that it has barely increased since May, which he seems to find troubling.<\/p>\n “Given that the recent revisions to the jobs numbers have been consistently lower, much lower, it wouldn’t be surprising if we learn with the coming revisions that employment is already declining,” he said.<\/p>\n Please help BI improve our Business, Tech, and Innovation coverage by sharing a bit about your role \u2014 it will help us tailor content that matters most to people like you.<\/p>\n What is your job title?<\/p>\n (1 of 2)<\/p>\n What products or services can you approve for purchase in your role?<\/p>\n (2 of 2)<\/p>\n Continue<\/p>\n By providing this information, you agree that Business Insider may use \n Thanks for sharing insights about your role.\n <\/p>\n
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