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NBER Determination of the February 2020 Peak in Economic Activity
Cambridge, June 8, 2020 -- The Business Cycle Dating Committee of the National Bureau of
Economic Research maintains a chronology of the peaks and troughs of U.S. business
cycles. The committee has determined that a peak in monthly economic activity occurred in
the U.S. economy in February 2020. The peak marks the end of the expansion that began
in June 2009 and the beginning of a recession. The expansion lasted 128 months, the
longest in the history of U.S. business cycles dating back to 1854. The previous record
was held by the business expansion that lasted for 120 months from March 1991 to March
The committee also determined that a peak in quarterly economic activity occurred
in 2019Q4. Note that the monthly peak (February 2020) occurred in a different
quarter (2020Q1) than the quarterly peak. The committee determined these peak dates in accord
with its long-standing policy of identifying the months and quarters of peak activity
separately, without requiring that the monthly peak lie in the same quarter as the quarterly
peak. Further comments on the difference between the quarterly and monthly dates are provided
A recession is a significant decline in economic activity spread across the economy,
normally visible in production, employment, and other indicators. A recession begins
when the economy reaches a peak of economic activity and ends when the economy
reaches its trough. Between trough and peak, the economy is in an expansion.
Because a recession is a broad contraction of the economy, not confined to one sector,
the committee emphasizes economy-wide indicators of economic activity. The committee
believes that domestic production and employment are the primary conceptual measures of
economic activity.
The Month of the Peak
In determining the date of the monthly peak, the committee considers a number of indicators of
employment and production. The committee normally views the payroll employment
measure, which is based on a large survey of employers, as the most reliable
comprehensive estimate of employment. This series reached a clear peak in February. The
committee recognized that this survey was affected by special circumstances associated with the
pandemic of early 2020. In the survey, individuals who are paid but not at work are counted as
employed, even though they are not in fact working or producing. Workers on paid furlough,
who became more numerous during the pandemic, thus resulted in an overcount of
people working in recent months. Accordingly, the committee also considered the
employment measure from the Bureau of Labor Statistics household survey, which excludes
individuals who are paid but on furlough. This series plateaued from December 2019
through February 2020, and then fell steeply from February to March. Because both
series measure employment during the week or pay period containing the 12th of the month,
they understate the collapse of employment during the second half of March, as
indicated by unprecedented levels of new claims for unemployment insurance. The committee
concluded that both employment series were thus consistent with a business cycle peak in

The committee believes that the two most reliable comprehensive estimates of aggregate
production are the quarterly estimates of real Gross Domestic Product (GDP) and of real Gross
Domestic Income (GDI), both produced by the Bureau of Economic Analysis (BEA). These
measures estimate production that occurred over an entire quarter and are not available monthly.
The most comprehensive monthly measure of aggregate expenditures, which includes roughly 70
percent of real GDP, is monthly real personal consumption expenditures (PCE), published by the
BEA. This series reached a clear peak in February 2020. The most comprehensive
monthly measure of aggregate real income is real personal income less transfers, from the
BEA. The deduction of transfers is necessary because transfers are included in personal income
but do not arise from production. This measure also reached a well-defined peak in February
The Quarter of the Peak
In dating the quarterly peak, the committee relies on real GDP and real GDI as published by the
BEA, and on quarterly averages of key monthly indicators. Quarterly real GDP and real GDI
peaked in 2019Q4.
The quarterly average of employment as measured by the payroll series rose from 2019Q4
to 2020Q1. However, the committee concluded that the special factor noted above implies that
the series should not play a significant role in determining the quarterly peak. The quarterly
average as measured by the household survey reached a clear peak in 2019Q4. The committee
concluded that like GDP and GDI, the number of people working also reached its quarterly peak
in 2019Q4.
The fact that the monthly peak of February occurred in the middle of 2020Q1 while the quarterly
peak occurred in 2019Q4 reflects the unusual nature of this recession. The economy contracted so
sharply in March (the final month of the quarter) that in 2020Q1, GDP, GDI, and employment
were significantly below their levels of 2019Q4.
Further Comments
The usual definition of a recession involves “a decline in economic activity that lasts more than a
few months.” However, in deciding whether to identify a recession, the committee weighs the
depth of the contraction, its duration, and whether economic activity declined broadly across the
economy (the diffusion of the downturn). The committee recognizes that the pandemic and the
public health response have resulted in a downturn with different characteristics and dynamics
than prior recessions. Nonetheless, it concluded that the unprecedented magnitude of the decline
in employment and production, and its broad reach across the entire economy, warrants the
designation of this episode as a recession, even if it turns out to be briefer than earlier contractions.
Committee members participating in the decision were: Robert Hall, Stanford University (chair);
Robert Gordon, Northwestern University; James Poterba, MIT and NBER President; Valerie
Ramey, University of California, San Diego; Christina Romer, University of California,
Berkeley; David Romer, University of California, Berkeley; James Stock, Harvard University;
Mark Watson, Princeton University.