The number of businesses that see a 50 percent chance or higher of a recession in 2022 has fallen from around two-thirds of respondents in October to just over half this month, according to a new survey from the National Association of Business Economics (NABE).
Businesses pointed to higher interest rates as the biggest downside risks, while identifying lower interest rates, higher labor participation and easing supply chain issues as the biggest upside risks. Overall though, recession fears remain elevated, and job growth expectations are waning.
“For the first time since 2020, more respondents expect falling rather than increased employment at their firms in the next three months," said Julia Coronado, president of NABE and founder and president of MacroPolicy Perspectives LLC, in a news release. "Fewer respondents than in recent years expect their firms' capital spending to increase in the same period.”
At the same time, more firms are reporting falling profit margins.
“Wages rose at a majority of respondents’ firms in the last three months of 2022 and more firms added workers than reduced headcounts," said Carlos Herrera, business conditions survey chair at NABE and chief economist for Coca-Cola North America. "But far more firms than in the past three years reported falling profit margins.
NABE's index for profit margin expectations is now down to its lowest level since mid-2020.
Yet tempering these concerns is a widespread expectation that inflation will continue to fall.
“The panel suggests that inflation may be easing with the outlook for prices charged at its lowest reading since the October 2020 survey, overall,” said Herrera. “Materials costs have drifted down significantly since last July, and more respondents expect falling costs in the next three months.”
An independent watchdog within the IRS reports that while taxpayer services have vastly improved, the agency is still too slow to resolve identity theft cases. And National Taxpayer Advocate Erin Collins says those delays are “unconscionable.” Erin M. Collins said in the report released Wednesday that overall the 2024 filing season went smoothly, though IRS delays in resolving identity theft victim assistance cases are worsening. It took nearly 19 months to resolve self-reported identity theft cases as of January, and Wednesday's report states that now it takes 22 months to resolve these cases.
Amazon.com Inc. surpassed $2 trillion in market value for the first time in afternoon trading on Wednesday. The push higher for Amazon’s stock market valuation comes a little more than a week after Nvidia hit $3 trillion and briefly became the most valuable company on Wall Street. Nvidia’s chips are used to power many AI application and its valuation has soared as a result. Amazon has also been making big investments in AI as global interest has grown in the technology. Most of the company’s focus has been on business-focused products.
Climate change doesn’t just mean more extreme weather – it also leads to billions of dollars in lost productivity, tourism, and stresses infrastructure.
It’s an annual tradition: the Fed’s banking ‘stress test.’ A year after the regional banking crisis, there are good reasons to make sure they’re prepped.
Summer is upon us, which means weddings, trips overseas, and trips to see Taylor Swift. Avoid a “Cruel Summer” with these budget-friendly tips and tricks.
