Since the onset of the pandemic, the specter of a deep and prolonged recession has weighed heavily on business leaders. Organizations have navigated external challenges: sustained inflation, rising interest rates, a historically tight job market, and fundamental changes to workplace arrangements. For many, the question seemed to be not about if but when a recession would hit.
However, over the last several months, encouraging signs have appeared. The economy grew 2.4% in the second quarter, and while the Consumer Price Index rose slightly in September to 3.7%, core inflation (which excludes volatile food and energy prices) only increased ever so slightly, indicating that inflationary pressures appear to be steadily easing. The job market also seems to be remaining strong, with unemployment steady at 3.8%. Though borrowing costs are still rising due to the Federal Reserve’s rate increases, they are historically competitive. In short, the hope of a soft landing may be possible, if not likely.
