OUR EXPLAINERS:

Here are the key indicators experts look at (and what they actually mean for you):

📉 GDP (Gross Domestic Product): The total value of all goods and services a country produces. When GDP shrinks for two quarters in a row, it usually signals the economy is contracting.

💰 Income: The average wages and earnings people are bringing in. During a recession, income growth often stalls or declines. 

👩‍💼 Employment: Tracks how many people are working. Rising unemployment or layoffs are red flags that the economy is under stress.

🏭 Manufacturing: Measures how much stuff companies are producing. A drop suggests companies expect fewer orders and might slow hiring.

🛍️ Retail Sales: Tracks how much people are spending on everyday goods. A decline means people are tightening their wallets.

There are usually early warning signs that a recession might be coming. Keep an eye out for these 5 signs so you’re never caught off guard: 

💼  Job cuts or hiring freezes: Companies anticipating tough times often cut staff or pause hiring.

📊  Market volatility: Unstable or dropping stock markets can signal lack of investor confidence.

💸  Slowing consumer demand: When people cut back on spending, businesses feel the impact.

📉  Declining business profits: Lower earnings may lead to layoffs and budget cuts.

 📈 Rate hikes or inflation spikes: Higher interest rates or costs can cool off economic activity.

How do recessions actually impact you? They can result in: 

• Layoffs or reduced hours (women, especially women of color, are often hardest hit).
• The cost of essentials can skyrocket while your paycheck doesn’t stretch as far.
• Credit card and loan approvals may tighten, especially if you don’t have strong credit.
• Your long-term financial goals (like saving for a house or investing) might need adjusting.