Seeing as it’s highly likely in the near future and life is already tight as fuck right now.. what exactly IS a recession? What does it mean for the average citizen like me? (UK). I’ve only ever heard it spoken about in very bad way and the last one happened when I was too young to worry.. but now, I’m kinda shitting it.
TIA
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Used correctly in (macro) economics, a recession is defined as two consecutive quarters (6 months) of reduction in total production of goods and services (also called GDP) in an economy as measured using currency terms.
There is no way to translate an aggregate measure (like inflation) or outcome (like recession) into specific effects to an individual. There can only be generalized statements that will not apply to everyone.
Some firms and jobs might do better in a recession. For example, high end goods sales might decrease and lower end goods might increase during recessions as people try to economize. Workers and businesses in low end retail might actually see increased activity.
Prolonged recessions, though, almost always leads to increased unemployment, businesses closing/shrinking and downward pressure on wages.
On a broader economic front, recessions are also thought of as a “natural” part of the economic cycle. Economies that expand too fast and too long tend to enter into an imbalance with one effect being high inflation. Some inflation is seen as necessary but if it rises to a very high level, a recession (short! most hope) is a process that “cools off” an economy somewhat and can reduce inflation. In this sense, a short recession can be seen as a necessary evil and will not severely damage the productive output of an economy and indeed might result in some needed rebalancing.
Very generally speaking, many jobs are quite recession proof in the short term. A well run, robust company has the resilience to weather short and mild recessions.
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