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Study: no recession yet
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August 10, 2001: 10:23 a.m. ET
NBER's business-cycle dating committee reports U.S. economy still afloat
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NEW YORK (CNNfn) - The U.S. economy may be slow but it's not in a recession, according to a report by an economic research group that studies business cycles and is usually one of the first groups to recognize a recession.
The business-cycle dating committee of the National Bureau of Economic Research (NBER) uses monthly economic data to find the beginning and end of periods of expansion and contraction in the U.S. economy, and it meets only when it needs to decide such periods.
In a report published last week, the NBER said it hasn't yet seen enough negative data to force a meeting to decide whether or not the economy is in recession.
The NBER said recent levels of employment and real personal income -- half of the data the group studies every month -- are not shrinking nearly as badly as they were in the last recession, which the group said ended in March 1991.
On the other hand, declines in the other two data items the NBER studies, real manufacturing and industrial production, more closely resemble the declines in the last recession.
"The data continue to suggest that the only substantial declines in real activity in the U.S. economy are in manufacturing, the sector reflected in the industrial production index and in real manufacturing and trade sales," the report said. "Broader aggregates, such as employment and real personal income, have not fallen significantly or at all."
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While the government defines a recession as two quarters of shrinking gross domestic product (GDP), the NBER defines a recession as "a period of significant decline in total output, income, employment, and trade, usually lasting from six months to a year, and marked by widespread contractions in many sectors of the economy."
The Cambridge, Mass.-based group thinks this definition of a recession allows it to respond more quickly to data and identify a recession earlier.
In order to avoid a recession and keep consumers spending during the year-long U.S. economic slowdown, the Federal Reserve has slashed its target for short-term interest rates six times this year. So far, the central bank's efforts have worked, as GDP has continued to grow and consumers have continued to spend. 
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