For most of us, a recession would not be a new experience,” says Rick Peterson, outgoing president of the Specialty Tool and Fasteners Distributor Association (STAFDA). Peterson was speaking at the STAFDA’s annual trade show and conference November in Denver, CO.
 
He cited historical statistics in his speech: 10 recessions since World War II, on average lasting 10 months each, a peak unemployment rate of 7.6% and a decline of gross domestic product (GDP) of 1.8%. The two worst modern recessions, he says, were those of 1973-1975 and 1981-1982. In those, unemployment reached 9% and 10%. “History tells us recessions are frequent and short-lived before the business cycle self-corrects and prosperity returns,” Peterson says.
 
The chief economist for the Manufacturers Alliance/MAPI in a Quarterly Economic Forecast out this week says: “The financial crisis worsened dramatically in the last three months and consumers suffered a major decline in wealth from declining housing prices and the plummeting stock market. High inflation, lower wage increases, and a shrinking number of jobs made individuals poorer and looking for ways to build some savings to weather hard times. A consumer–led decline aggravated by a credit crunch is a recipe for trouble.”
 
There are some bright spots in the current economy, however. High-tech industrial production is expected to rise 14.4% in 2008 and 6.6% in 2009. Exports may continue to offer some relief. Export growth is expected to outpace that of imports by a wide margin, according to MAPI’s report. Export growth should rise 8.4% (inflation-adjusted) in 2008 and by 0.9% in 2009.
 
Peterson pointed out in his STAFDA speech that the “real economy” of spending, production and jobs is “hardly in a state of collapse.” Exports have buoyed GDP growth, and consumers have continued to spend. Interest rates have fallen. As the association members’ primary market of residential construction is weak, “STAFDA members, as they have so often done in the past, will need to shift their sales emphasis to commercial, industrial and other market sectors,” he advised. Non-residential, he pointed out, is ahead 3% through September.

Here’s an interesting overview of the past few months and what is going on currently in the economy.