What’s the difference between a recession, a depression and a cost of living crisis?
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Cost of Living crisis is happening because inflation is much higher than wages so people are getting poorer in real terms as their spending money can’t buy as much stuff (and if rents are accelerating as well, for example, they have less to spend anyway). This is happening despite most global economies growing.
A recession is defined (certainly in the UK) as two consecutive quarters of negative growth (i.e. the economy shrinking for two straight quarters of the year).
Depression and recession are often used interchangeably but a depression would probably be considered as a longer or harsher period of contraction.
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