Updated: Aug 14, 2020
Unlike recessions, which it’s up to the committee to declare, depressions are kind of vague. The NBER doesn’t define depressions or identify them, according to an FAQ on its
website. They’re also rare: Whereas there was a recession just over a decade ago, the most recent period that’s generally regarded as a depression was in the 1930s.
Generally, depressions are linked with a long period of high unemployment, Gimbel says.
Recent Bureau of Labor Statistics estimates put the national unemployment rate at just under 15%. But the bureau noted that it thinks some people mistakenly classified themselves
as employed but absent from work. If that group was reclassified as unemployed, the rate would be nearly 20%.
The highest unemployment rate during the Great Depression was in 1933, when it reached 24.9%. Given that the U.S. is currently a couple percentage points below that, “we are at depression-level unemployment,” Gimbel says.
However, Moser says it’s premature to say we’re in a depression now because the committee hasn’t even declared a recession yet.
“What people generally have in mind when they talk about the Great Depression is a very severe and lengthy recession,” he adds. “If the recession we might head into were to be
very severe — and we have signs it will be very severe, will last for a long time and take a long time to recover from — then people, maybe in a couple of years, will say, “Look, this
really was the onset of a Great Depression."