Every U.S. Recession Since 1900
From the Panic of 1907 to the COVID crash of 2020 — a data-driven history of America's 23 economic downturns, what caused them, and how the nation recovered.
The Business Cycle: A Century of Booms and Busts
The U.S. economy has experienced 23 recessions since 1900, as defined by the National Bureau of Economic Research (NBER). That's roughly one downturn every 5.4 years, though the frequency has decreased markedly over time — the economy experienced 15 recessions in the first half of the century but only 8 since 1950.
Early 20th-century downturns were frequent, sharp, and largely unmanaged. There was no Federal Reserve until 1913, no FDIC until 1933, no unemployment insurance until 1935. The economy operated without a safety net, and financial panics could cascade through the banking system in days. Since the establishment of modern monetary and fiscal tools, recessions have become less frequent and generally less severe — with notable exceptions.
"Prosperity is just around the corner."
— Herbert Hoover, 1932 (attributed), during the Great DepressionRecession Duration Comparison
How long did each downturn last? The Great Depression towers over all others at 43 months, while the COVID recession of 2020 was the shortest on record at just 2 months.
The Major Downturns
While every recession brings hardship, some have fundamentally reshaped the American economy and the role of government. These are the most consequential downturns of the past 125 years.
The Great Depression
August 1929 – March 1933 (43 months)The defining economic catastrophe of the 20th century. Beginning with the stock market crash of October 1929, the Depression wiped out $30 billion in market value in two days. By 1933, GDP had contracted by nearly 27%, a quarter of the workforce was unemployed, and over 9,000 banks had failed — taking depositors' savings with them. Industrial production fell by nearly half. World trade collapsed by 65%. The crisis spawned the New Deal, created Social Security, the SEC, the FDIC, and fundamentally transformed the relationship between government and the economy. Recovery was slow and incomplete until WWII military spending finally restored full employment.
The Panic of 1907
May 1907 – June 1908 (13 months)A failed attempt to corner the copper market triggered bank runs that nearly collapsed the financial system. J.P. Morgan personally organized a private bailout, locking bankers in his library until they agreed to inject liquidity. The crisis convinced Congress that the nation needed a central bank, leading directly to the creation of the Federal Reserve in 1913.
The Depression of 1920–21
Jan 1920 – Jul 1921 (18 months)Often called the "Forgotten Depression," this was one of the sharpest deflations in American history. Prices dropped 18% in a single year as the post-WWI economy unwound. The government did almost nothing — no stimulus, no bailouts — and the economy recovered rapidly on its own, fueling the Roaring Twenties boom. Libertarian economists cite it as evidence that markets self-correct; Keynesian economists argue the circumstances were unique.
The Roosevelt Recession
May 1937 – Jun 1938 (13 months)Just as the economy was recovering from the Depression, FDR cut spending and the Fed tightened credit, fearing inflation. The result was a sharp "recession within a Depression." Industrial production fell 33% and the stock market dropped 49%. It became a cautionary tale about premature fiscal austerity — one that policymakers explicitly referenced during the 2009 recovery debate.
The Oil Shock Recession
Nov 1973 – Mar 1975 (16 months)The OPEC oil embargo quadrupled oil prices virtually overnight, triggering the worst downturn since the Depression. The crisis introduced "stagflation" — simultaneous stagnation and inflation — to the vocabulary. Gas lines stretched for blocks. The S&P 500 fell 48% from peak to trough. It shattered the postwar Keynesian consensus that policymakers could always trade off unemployment for inflation.
The Volcker Recession
Jul 1981 – Nov 1982 (16 months)Fed Chairman Paul Volcker intentionally triggered this recession by raising interest rates to 20% to crush runaway inflation. It was brutally effective. Inflation fell from 14.8% to 3.2%, but at enormous cost: unemployment hit 10.8%, the highest since the Depression. Manufacturing was devastated, with the Rust Belt never fully recovering. It remains the most deliberate recession in American history — a calculated sacrifice of short-term pain for long-term price stability.
The Dot-Com Bust
Mar 2001 – Nov 2001 (8 months)The bursting of the tech bubble erased $5 trillion in Nasdaq market value between March 2000 and October 2002. Companies like Pets.com and Webvan became symbols of speculative excess. The 9/11 attacks deepened the downturn. The Fed slashed rates to 1%, planting the seeds for the housing bubble that would trigger the next crisis. Mild by GDP metrics, but devastating for the tech sector.
The Great Recession
Dec 2007 – Jun 2009 (18 months)A housing bubble fueled by subprime mortgages and exotic financial instruments (CDOs, credit default swaps) triggered the worst financial crisis since 1929. Lehman Brothers collapsed. AIG was bailed out. The entire global financial system teetered on the edge. The response was unprecedented: TARP ($700B bailout), massive Fed intervention (quantitative easing), and the $787B stimulus package. 8.7 million jobs were lost, 3.8 million homes were foreclosed on, and the recovery took over 6 years to restore pre-crisis employment levels. Median household wealth wouldn't recover until 2019.
The COVID-19 Recession
Feb 2020 – Apr 2020 (2 months)The shortest and sharpest recession in American history. When the pandemic forced shutdowns in March 2020, 22 million jobs vanished in weeks — more than were lost during the entire Great Recession. GDP fell at an annualized rate of 31.2% in Q2 2020. Congress responded with over $5 trillion in relief spending (CARES Act, PPP, stimulus checks, enhanced unemployment). The economy snapped back with remarkable speed, but the fiscal response contributed to the highest inflation since the early 1980s, peaking at 9.1% in June 2022.
"The only thing we have to fear is fear itself — nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance."
— Franklin D. Roosevelt, First Inaugural Address, March 4, 1933GDP Decline by Recession
Measured by the peak-to-trough decline in real GDP, the Great Depression dwarfs all others. But note the severity of the 1937–38 downturn and how modern recessions, while painful, involve much smaller output losses.
Peak Unemployment by Recession
Unemployment is the human face of recession. This chart shows how the job market pain has shifted over the decades — from the catastrophic 25% of the Depression to the rapid but brief COVID spike.
The Misery Index: Unemployment + Inflation
Economist Arthur Okun created the "Misery Index" by adding the unemployment rate to the inflation rate. It's a simple but powerful measure of how much economic pain ordinary Americans feel. A reading above 10 signals significant distress; above 15 is a crisis; above 20 is rare and devastating.
Peak misery: The late 1970s through early 1980s combined the worst of both worlds — double-digit unemployment and double-digit inflation. The 1980 reading of 22.0 (7.1% unemployment + 14.8% inflation) helped sweep Ronald Reagan into office.
"I can assure you that it is safer to be in a U.S. bank than under a mattress."
— Franklin D. Roosevelt, Fireside Chat, March 12, 1933Stock Market Declines During Recessions
Markets often decline before recessions start and bottom before they end. The peak-to-trough losses show how devastating bear markets can be for investors caught off guard.
Recession Warning Signs & Patterns
⚠️ Common Warning Signs
- Inverted yield curve: Short-term rates exceed long-term rates — has preceded every recession since 1955 with only one false signal
- Rising unemployment claims: Sustained increases in initial jobless claims often lead recessions by 6–12 months
- ISM below 50: Manufacturing Purchasing Managers' Index below 50 signals contraction
- Consumer confidence plunging: Sharp drops in the Conference Board survey correlate with reduced spending
- Credit tightening: When banks sharply reduce lending, economic slowdown typically follows
- Housing market weakening: Building permits and housing starts often decline 12–18 months before recessions
📈 Recovery Indicators
- Yield curve normalizes: Long-term rates moving above short-term rates signals confidence
- Unemployment claims peak: When initial claims start declining, the labor market is turning
- Leading Economic Index: Three consecutive monthly increases suggest recovery
- Credit loosening: Banks relaxing lending standards indicates growing confidence
- Manufacturing rebound: ISM crossing back above 50 signals expansion
- Consumer spending uptick: Retail sales turning positive, especially durable goods
The yield curve's track record: An inverted yield curve has predicted every recession since 1955. It inverted in July 2022 — the longest inversion on record — before normalizing in late 2024. Whether the recession it predicted was the "soft landing" or is still coming remains one of the most debated questions in economics.
"Recessions are a time to be aggressive. It's the best time to invest."
— Warren BuffettTimeline: 125 Years of Economic Upheaval
"In a crisis, be aware of the danger — but recognize the opportunity."
— John F. KennedyRecessions and the Presidency
Recessions are among the most powerful forces in American politics. Since 1900, no president has survived a recession in an election year without paying a steep political price. The economy doesn't care about party — it has punished Republicans and Democrats alike.
Herbert Hoover (1932): Defeated in a landslide after the Depression he couldn't stop — or convince the public he was trying to. Gerald Ford (1976): The 1973–75 recession lingered in voters' minds. Jimmy Carter (1980): Stagflation and the "malaise" perception doomed his re-election. George H.W. Bush (1992): "It's the economy, stupid" — James Carville's famous line captured how the mild 1990–91 recession ended Bush's presidency. The campaign mantra proved so effective it became a permanent part of political vocabulary.
Complete Data: Every U.S. Recession Since 1900
The table below shows all 23 NBER-dated recessions, with key economic indicators for each. Peak-to-trough GDP figures use real (inflation-adjusted) data where available. Stock market figures represent the approximate peak-to-trough decline in the DJIA or S&P 500 during or around the recession period.
| # | Recession | Duration | GDP Decline | Peak Unemp. | Stock Drop | Primary Cause |
|---|---|---|---|---|---|---|
| 1 | Sep 1902 – Aug 1904 | 23 mo | -1.8% | ~4.0% | -29% | Stock decline, crop failures |
| 2 | May 1907 – Jun 1908 | 13 mo | -11.0% | ~8.0% | -48% | Panic of 1907, bank runs |
| 3 | Jan 1910 – Jan 1912 | 24 mo | -3.2% | ~5.9% | -25% | Tight money, trade disruption |
| 4 | Jan 1913 – Dec 1914 | 23 mo | -4.6% | ~7.9% | -24% | WWI disruption, Fed transition |
| 5 | Aug 1918 – Mar 1919 | 7 mo | -1.5% | ~5.2% | -11% | Post-WWI, Spanish Flu |
| 6 | Jan 1920 – Jul 1921 | 18 mo | -6.9% | 11.7% | -47% | Post-war deflation |
| 7 | May 1923 – Jul 1924 | 14 mo | -3.4% | ~5.5% | -19% | Fed tightening |
| 8 | Oct 1926 – Nov 1927 | 13 mo | -2.0% | ~4.4% | -9% | Auto slump, FL real estate bust |
| 9 | Aug 1929 – Mar 1933 | 43 mo | -26.7% | 24.9% | -86% | Stock crash, bank failures, global collapse |
| 10 | May 1937 – Jun 1938 | 13 mo | -18.2% | 19.0% | -49% | Premature austerity, Fed tightening |
| 11 | Feb 1945 – Oct 1945 | 8 mo | -11.6% | ~4.3% | -7% | Post-WWII demobilization |
| 12 | Nov 1948 – Oct 1949 | 11 mo | -1.7% | 7.9% | -16% | Post-war adjustment |
| 13 | Jul 1953 – May 1954 | 10 mo | -2.2% | 6.1% | -13% | Korean War drawdown, Fed tightening |
| 14 | Aug 1957 – Apr 1958 | 8 mo | -4.1% | 7.5% | -21% | Fed tightening, Asian flu |
| 15 | Apr 1960 – Feb 1961 | 10 mo | -1.6% | 7.1% | -14% | Fed tightening |
| 16 | Dec 1969 – Nov 1970 | 11 mo | -0.6% | 6.1% | -36% | Vietnam spending, inflation |
| 17 | Nov 1973 – Mar 1975 | 16 mo | -3.2% | 9.0% | -48% | OPEC oil embargo, stagflation |
| 18 | Jan 1980 – Jul 1980 | 6 mo | -2.2% | 7.8% | -17% | Fed tightening, oil prices |
| 19 | Jul 1981 – Nov 1982 | 16 mo | -2.7% | 10.8% | -27% | Volcker rate shock (20%) |
| 20 | Jul 1990 – Mar 1991 | 8 mo | -1.4% | 7.8% | -20% | S&L crisis, Gulf War oil spike |
| 21 | Mar 2001 – Nov 2001 | 8 mo | -0.3% | 6.3% | -49% | Dot-com bust, 9/11 |
| 22 | Dec 2007 – Jun 2009 | 18 mo | -4.3% | 10.0% | -57% | Housing bust, financial crisis |
| 23 | Feb 2020 – Apr 2020 | 2 mo | -5.1% | 14.7% | -34% | COVID-19 pandemic shutdown |
Sources: National Bureau of Economic Research (NBER), Bureau of Economic Analysis (BEA), Bureau of Labor Statistics (BLS), Federal Reserve Economic Data (FRED), S&P Dow Jones Indices. GDP figures for pre-1929 recessions are estimates based on available industrial production and GNP data. Unemployment figures before 1929 are historical estimates.
How Long Does Recovery Take?
A recession may officially end when GDP stops contracting, but recovery — returning to pre-recession employment and output levels — takes much longer. The gap between the "official end" and the "felt end" of a recession is one of the most important dynamics in economics and politics.
"The test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little."
— Franklin D. Roosevelt, Second Inaugural Address, 1937What Causes Recessions?
No two recessions are exactly alike, but they tend to fall into a handful of categories. Understanding the cause matters because it determines the appropriate policy response — and how quickly recovery can begin.
Financial Panics & Crises
1907, 1929, 2007The most damaging category. Banking crises destroy the credit system that lubricates the entire economy. Recovery is slow because trust must be rebuilt, balance sheets repaired, and new regulations established. The 2008 crisis showed that even a century after 1907, financial innovation can outrun regulation.
Fed Tightening
1953, 1958, 1960, 1980, 1981The Federal Reserve raising interest rates to combat inflation is the single most common recession trigger since WWII. These recessions are, in a sense, "intentional" — the Fed accepts short-term pain to prevent the worse outcome of entrenched inflation. Recovery usually follows once rates are cut.
Supply Shocks
1973, 1990, 2020External events that disrupt the supply side of the economy. Oil embargoes, pandemics, and natural disasters can suddenly reduce economic capacity. These are the hardest to predict and often the most disorienting because they don't follow the normal credit cycle.
Asset Bubbles
1926, 1929, 2001, 2007When speculative enthusiasm drives asset prices far beyond fundamental values, the inevitable correction drags down the real economy. The Florida land boom (1926), stock market (1929), dot-com stocks (2001), and housing (2007) all followed the same pattern of mania, panic, and crash.
Post-War Adjustment
1918, 1920, 1945, 1953The transition from wartime to peacetime economies has consistently triggered recessions. Government spending drops sharply, millions of soldiers return to the labor market, and industries must retool. These recessions are structurally inevitable but usually resolve as the civilian economy adapts.
Policy Errors
1937, 1929 (worsened)Sometimes the government makes things worse. FDR's premature spending cuts in 1937 and the Fed's passive response in 1929–32 are textbook policy errors. The Smoot-Hawley Tariff of 1930, which raised tariffs on 20,000+ imported goods, helped turn a recession into a depression by collapsing world trade.
The Longest Expansions
The flip side of recessions: the periods of sustained growth between them. The modern economy has gotten much better at sustaining expansions — the five longest on record have all occurred since 1960.
| Rank | Expansion Period | Duration | Ended By | GDP Growth |
|---|---|---|---|---|
| 1 | Jun 2009 – Feb 2020 | 128 months | COVID-19 pandemic | ~25% |
| 2 | Mar 1991 – Mar 2001 | 120 months | Dot-com bust | ~43% |
| 3 | Apr 2020 – Present | 57+ months | Ongoing | ~11% |
| 4 | Nov 1982 – Jul 1990 | 92 months | S&L crisis, oil spike | ~37% |
| 5 | Feb 1961 – Dec 1969 | 106 months | Vietnam inflation | ~52% |
| 6 | Nov 2001 – Dec 2007 | 73 months | Housing crash | ~18% |
| 7 | Mar 1975 – Jan 1980 | 58 months | Oil shock, inflation | ~22% |
| 8 | Oct 1945 – Nov 1948 | 37 months | Inventory correction | ~15% |
A trend toward longer expansions: Before 1950, the average expansion lasted about 26 months. Since 1950, it's 68 months. The combination of better monetary policy, automatic fiscal stabilizers (unemployment insurance, progressive taxation), and deposit insurance has made the economy more resilient — though clearly not recession-proof.
"Capitalism without bankruptcy is like Christianity without hell."
— Frank Borman, astronaut and CEO of Eastern Air LinesWhat Have We Learned?
A century of economic downturns has yielded hard-won insights — though whether policymakers consistently apply them is another question entirely.
❌ Mistakes That Made Recessions Worse
- Smoot-Hawley (1930): Protectionist tariffs collapsed world trade and deepened the Depression
- Fed passivity (1929–32): Allowing money supply to contract by 33% turned a recession into a catastrophe
- Premature austerity (1937): Cutting spending before recovery was complete triggered a second collapse
- Gold standard rigidity: Countries that left gold earlier recovered faster from the Depression
- Lehman Brothers (2008): Letting a systemically important bank fail accelerated the crisis dramatically
✅ Policies That Shortened Recessions
- FDIC creation (1933): Ended bank runs, the primary transmission mechanism of panics
- Automatic stabilizers: Unemployment insurance and progressive taxation smooth the cycle without legislative action
- Aggressive monetary response (2008, 2020): The Fed cut rates to zero and deployed QE within weeks
- Fiscal stimulus (2009, 2020): Direct payments, extended benefits, and PPP cushioned the sharpest impacts
- Volcker's resolve (1981–82): Short-term pain produced three decades of low, stable inflation
Sources & Methodology
Recession dates are from the National Bureau of Economic Research (NBER), the official arbiter of U.S. business cycles. GDP data comes from the Bureau of Economic Analysis (BEA) and historical estimates from Balke and Gordon (1989) for pre-1929 figures. Unemployment data is from the Bureau of Labor Statistics (BLS) and Lebergott (1964) for historical estimates. Stock market data uses the S&P 500 (post-1957) and Dow Jones Industrial Average (earlier periods). The Misery Index was developed by economist Arthur Okun in the 1970s.