The US economy was in recession for two months in 2020 at the beginning of the COVID-19 pandemic as businesses shut their doors nationwide and laid-off employees, the committee making the determination said Monday.
Economic activity peaked in February 2020 and hit its trough the following April, making the recession that began in March the shortest on record, according to the Business Cycle Dating Committee of the National Bureau of Economic Research (NBER), a non-profit, non-partisan research organization.
The downturn suddenly ended 128 months of expansion in the world's largest economy as cities and states nationwide ordered businesses to close or curtail operations to stop the spread of COVID-19.
However increases in employment and economic growth that occurred from May 2020 onwards cut the recession short, the NBER said.
"The committee decided that any future downturn of the economy would be a new recession and not a continuation of the recession associated with the February 2020 peak. The basis for this decision was the length and strength of the recovery to date," it said in a statement.
The pandemic caused horrific damage to the world's largest economy, with government data showing 22 million jobs lost between February and April 2020, and GDP contracting 31.4%, annualized, in the second quarter, when the restrictions were at their worst.
However the economy resumed expansion in May 2020, the NBER said, and in the year since has recovered ground.
The IMF predicts the US economy could expand seven percent this year, its fastest pace since 1984, after collapsing 3.5% in 2020, its worst year since modern record keeping began in 1946.