Economists, Biden say recession possible, not inevitable

A group of economists surveyed by the Wall Street Journal placed the chances of the United States entering a recession in the next 12 months at 44%.

The odds of a recession have jumped greatly from past surveys. In January, the WSJ's survey placed the odds at 18%. Those chances increased to 28% in April.

While unemployment generally goes up during periods of recession, the experts surveyed believe unemployment will remain below 5%. They expect unemployment to creep up from 3.6% currently to 4.2% at the end of 2023.

During the recession of 2008-09, unemployment more than doubled to 10%.

Although the S&P 500 has lost 24% of its value since the start of the year, President Joe Biden told reporters Monday that a recession is not inevitable. Part of what is sparking concern for a recession is the Federal Reserve's latest interest rate hike.

The Fed announced a significant .75% jump in a key interest rate in hopes of quailing inflation.

Economists told the Wall Street Journal part of their concern is that spending power will decrease if inflation continues to remain high.