Seventy-five percent of the nation's top economic forecasters contend the nation has sunk into a recession, although two-thirds expect it to be mild and end by April, according to a survey released Tuesday.
"Recession is here," the National Association of Business Economists said in a report on its canvass of 51 professional forecasters.The finding was a dramatic switch from an NABE survey just a year ago, when 62 percent of the forecasters said the economy would escape a recession through 1992. Just after the Iraqi invasion of Kuwait in August, 45 percent of the forecasters said a recession either had begun or was imminent.
Some economists on the panel who say the downturn has not yet begun predicted a recession would begin early next year.
Only 15 percent of the panel continue to hold to the "no recession" scenario.
The NABE survey mirrored an earlier survey this month by Blue Chip Economic Indicators. Eighty percent of the 52 prominent economists participating in that study said a recession will begin before year's end. Another five percent said it would begin in 1991.
Virtually all of the NABE forecasters who contend the economy is in recession say it began either in the third or the current quarter.
"The recession is also expected to be mild in historical terms, with the trough occurring in the first quarter of 1991," the NABE report said. It projected economic growth to decline 1.0 percent in the current quarter and 0.8 percent in the next.
A recession generally is defined as two consecutive quarters of negative growth.
"If the current expansion is dead, it lived a long and prosperous life of 93 months (assuming an August peak) and was just a year short of the longest postwar business expansion of 1961-1969," the report said.
The forecasters project the economy will expand just 1 percent for all of 1990 and 0.8 percent next year. That includes inching up 0.6 percent in the second quarter and growth of 2 percent in the third and 2.5 percent in the fourth. The economy grew 2.5 percent in 1989 and 4.5 percent in 1988.
The survey also found the forecasters believe unemployment will rise from 5.5 percent this year to 6.1 percent in 1991. The jobless rate in October was 5.7 percent, up from 5.2 percent in June.
At the same time, inflation as measured by the Labor Department's Consumer Price Index will drop from 5.5 percent in 1990 to 5.2 percent in 1991. The 1990 rate forecast in the latest survey is up from 5.3 percent in the previous survey because of higher oil prices following the Aug. 2 Iraqi invasion of Kuwait, the report said.
Corporate profits are projected to decline 4 percent this year and 1.3 percent in 1991.