(RTTNews) - The body charged with the task of officially identifying recessions said Monday that the U.S. began its economic slump in December of last year.

The National Bureau of Economic Research determined that the peak in U.S. economic activity took place in December 2007. This marked the end of an expansion that began in November 2001 and the beginning of a recession.

The last expansion lasted 73 months, the NBER said. To put that in context, the organization pointed out that the previous expansion of the 1990s lasted 120 months.

The dating of a recession is a matter of some controversy, given the somewhat unclear definition of just what a recession is.

Traditionally, a recession has been defined as two consecutive quarters of contraction in Gross Domestic Product, a broad measure of economic activity. However, many experts argue that such a definition is too narrow, an opinion shared by the NBER.

The organization said that most of the time the recessions it identifies have at least two quarters of declining GDP, but not always. For example, the 2001 recession did not include two consecutive quarters of contraction.

For its latest determination, the NBER said that it looked most closely at payroll employment, which it called the “most reliable comprehensive estimate of employment.”

The NBER pointed out that payroll employment peaked in December of 2007 and has declined in every month since then.

On Friday, the government will announce its latest statistics for payroll employment. More job losses are projected for November, with economists looking for a drop in payrolls of about 300,000.

This would indicate an acceleration from the previous month. Statistics released last month showed the economy shed 240,000 jobs in October, though that number will probably be revised when new data comes out Friday. For September, payrolls declined 284,000.

With October’s statistics added in, the country has lost 1.2 million jobs this year.

In response to those statistics, President-elect Barack Obama pledged to devise a plan aimed at creating 2.5 million jobs by 2011.

Last week, the government released revised statistics for third-quarter economic performance. The Commerce Department revealed that GDP dropped by 0.5 percent in the July-to-September period, a bigger decline than the 0.3 percent that was originally reported.

The economy has suffered over the past year, as the slumping housing market has dragged down other sectors of the economy and has led to unprecedented turmoil in financial markets.

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Posted in Categories: Economy, Forex, Releases, USA.

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