Predicting When the Recession Will End: Economic Experts Weigh In

Fund raisers are searching for every way to possible to figure out when the recession is over— and contributions to their organizations — will return to pre-recession levels.

That’s the million-dollar question, and to help answer it, the Kiplinger Business Resource Center has created a Recovery Index to signal when the recession is finally ending.

Here’s how it works: Kiplinger’s financial editors are monitoring six key economic indicators as information is released: monthly index of consumer confidence, monthly sales data for existing home sales, weekly jobless claims, monthly orders for durable goods, monthly retail sales, and the interest-rate spread, which reflects banks’ calculation of lending risk. When Kiplinger editors give at least three of the six indicators a positive rating, “It is more than likely the recession has ended,” they write.

Since it takes the National Association of Business Economists months to determine when a recession officially begins and ends, the Kiplinger index could be a useful tool.

But so far, Kiplinger has given only one economic indicator—the interest-rate spread—a positive rating.

That’s in line with the Kiplinger editors’ prediction of a long, painful recovery, judging from some of their recent headlines: Job Growth Still a Year Away, Economy’s Recovery Will Be Lethargic, and Frugal Shoppers Are Here to Stay.

Are you seeing signs of a recovery at your organization — or does it still feel like the recession is in progress?