CORPUS CHRISTI, Texas — How do we know when we’re in a recession? Numbers indicate we might already be there.
People think the federal government dictates when we’re in a recession. It actually comes from a committee at a private non-profit group called the National Bureau of Economic Research (NBER).
Traditionally and according to the U.S. Bureau of Economic Analysis, two consecutive quarters of negative gross domestic product (GDP) growth has signaled times of a recession.
The first quarter came in at -1.6. According to the Atlanta Federal Reserve GDPNow estimation, as of Friday, it's at -1.2.
Noe Villalobos runs a food truck and said it’s been a struggle. He’s having trouble finding necessities to run his truck, having to travel to other major cities.
“I can see the change right now where we can’t find a lot of stuff," Villalobos said, owner of El General Food Truck. "A lot of stuff is getting expensive. We used to run the truck for say a couple of thousand dollars. Now it's taking like three times more.”
Mark Schaberg, operating partner of Brewster Street Icehouse doesn’t think we’re there yet. He said the restaurant and attraction industries are having a good summer.
“The customers are still out there," said Schaberg, also the operating partner of Concrete Street Amphitheater. "People aren’t going to stay home. They’re just looking for that great value and we think we deliver that here at Brewster's.”
Schaberg says customers will show when we’re in a recession.
“Consumer confidence is important," he said. "And so, if you watch the media, of course gas prices and food costs and stuff are going up. One of the things we try really hard to do here at Brewster Street is create a value experience.”
Because GDP numbers usually come out quarterly, NBER looks at factors on a monthly basis to get a picture on a recession. They look at employment, personal income and industrial production.
The unusual part about having a negative GDP is that unemployment has stayed at 3.6 percent for 4 months. 5.9 million Americans are out of work, close to the number before the Covid-19 pandemic. According to Institute for Supply Management, the industrial and service sectors are on a growing trajectory, as well.
We’ll know more when the estimated second quarter GDP comes out on July 28.