Recession of 1949

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US unemployment rate, 1948–1955

The Recession of 1949 was a downturn in the United States lasting for 11 months. According to the National Bureau of Economic Research, the recession began in November 1948 and lasted until October 1949.[1]

The 1949 recession was a brief economic downturn; forecasters of the time expected much worse, perhaps influenced by the poor economy in their recent lifetime.[2] The recession began shortly after President Truman's "Fair Deal" economic reforms. The recession also followed a period of monetary tightening by the Federal Reserve.[3]

The GDP of the U.S.[edit]

During this recession, the Gross domestic product of the United States fell 1.7 percent. In October 1949, the unemployment rate reached its peak for the cycle of 7.9 percent.[4]

Main causes of the recession[edit]

Many[who?] regard the aftermath of the end of World War II to be the main cause of the recession. According to C. A. Blyth "the most important cause of 1948-1949 recession was substantial fall in the fixed investments".[5]

The severity of this recession[edit]

Maximum unemployment was about 7.9%. Change in Gross National Product GNP reduced by up to -1.5%. Department store sales fell 22%. The wholesale price and cost of living indexes fell 12 and 5 points.[6]


  1. ^ "NBER Business Cycle Expansions and Contractions". NBER. Retrieved 2008-10-01.
  2. ^ Zarnowitz, Victor (1996). Business Cycles: Theory, History, Indicators, and Forecasting. Chicago: University of Chicago Press. p. 416. ISBN 0-226-97891-5.
  3. ^ Labonte, Marc (2002-01-10). "The Current Economic Recession" (PDF). Congressional Research Service. Archived from the original (PDF) on 2009-10-10. Retrieved 2008-03-05.
  4. ^ Labour Force Statistics from the Current Population Survey, Bureau of Labour Statistics. Retrieved on September 19, 2009
  5. ^ Arnold Zellner (August 1957). "Consumption and the Consumption Function in the U.S. 1948-1949 Recession". The Review of Economics and Statistics. 39 (3): 303–311. doi:10.2307/1926046.
  6. ^ D. Hamberg (March 1952). "The Recession of 1948-49 in the United States". The Economic Journal. 62 (245): 1–14. doi:10.2307/2227168.

Further reading[edit]