Recession Is Already Here for Many Small Businesses

When central bankers and economists gather in Jackson Hole, Wyo., this coming week to debate the trajectories of inflation and monetary policy, there will be hopeful talk of peak prices and renewed discussion of softish landings. They will be missing the point.

For small businesses and households across America, recession isn’t an abstract concept or technical definition. It is a reality that many say they have felt since the start of this year, as rapidly rising prices ate into consumers’ budgets, hit firms’ profit margins, and pushed the cost of credit higher. Recently, the pain has lessened. A slowdown in major inflation gauges alongside an indication of robust hiring have investors betting anew on a “Goldilocks economy” that gently falls back into balance and allows for the Federal Reserve to stop tightening sooner than previously expected.