Despite indications that inflation may be beginning to decline, economists continue to predict that even higher interest rates will cause the US economy to enter a recession in the upcoming year.
Although we may see positive economic indicators such as decreasing inflation rates and increasing consumer spending, according to The Wall Street Journal report, business and academic economists predict a 61% possibility of an economic recession in 2023.
Several elements that could increase the likelihood of a recession in the economy in 2023 are global uncertainty, interest rates, inflation, supply chain disruptions, and the COVID-19 pandemic. However, no fortune teller can foretell the exact timing of a possibility of an economic recession in 2023.
Hence, Real Research, an online survey app, launched a survey on the possibility of an economic recession in 2023 to gather opinions on the current global economic conditions and to determine the possibility of an economic recession in 2023.
- Almost half of the respondents (49.21%) expect a recession by Q2 of 2023
- 39.15% are highly concerned about the possibility of a recession hitting their country
- 31.42% report mixed views about the current global economy
Real Research recently conducted a study on the possibility of an economic recession in 2023 to outline all significant aspects of a recession and let the public make the final decision based on the given criteria.
Major incidents like the Russia-Ukraine conflict, the aftermath of Covid-19, the US-China trade war, the increase in crude oil prices, etc., could play a significant role in the global economy. When the respondents were asked about their awareness of such events affecting the global economy, 71% reported they were well aware. On the other hand, 29% reported being unaware of such events affecting the global economy.
Next, our survey asked respondents whether they expect the global economy to experience a recession in the second quarter of 2023 in light of concerns expressed by experts.
Nearly half of the respondents (49%) said they believe a recession is definitely on the horizon. 38% said a recession is probable, while only 7% said a recession is unlikely. Additionally, just 1% of respondents said they believe a recession is definitely unlikely.
Experts Weigh in on Possible Contributors to a Looming Recession
Understanding the factors that could contribute to a potential economic recession in the forthcoming months is crucial for businesses and policymakers alike. Our survey asked respondents to identify the factor they believe would most significantly contribute to the possibility of an economic recession in 2023.
According to figure 1, rising inflation rates, the Russia-Ukraine conflict, and rising interest rates are three factors that received the highest percentage of responses, at 20%, 18%, and 18%, respectively.
Meanwhile, the persistent consequences of the Covid-19 pandemic and reduced investments were also identified as potential drivers of a recession, with 13% and 17% of respondents citing these factors.
These results suggest that multiple factors could contribute to the possibility of an economic recession in 2023 and that businesses and policymakers should be preparing for various scenarios.
Widespread Anxiety About Economic Recession in the Wake of Pandemic
The possibility of an economic recession in 2023 can cause significant anxiety for individuals and businesses alike. When the respondents were asked how concerned they were about the possibility of a recession hitting their country of residence, 39% stated “highly concerned.” Meanwhile, 31% are somewhat concerned.
In contrast, 16% of respondents are somewhat unconcerned, and 8% are highly unconcerned. Notably, 6% were uncertain about their level of concern.
Similarly, when asked how concerned they were about the possibility of an economic recession’s impact on personal finance, 41% were highly concerned, followed by somewhat concerned (33%), somewhat unconcerned (15%), and highly unconcerned (5%). Besides, 5% remained uncertain about it.
Widespread Financial Planning Changes Among Individuals
Individuals may significantly alter their financial planning due to worries about a possibility of an economic recession in 2023. In response to worries about a recession, we asked survey participants if they had altered their financial planning in any way.
According to the results, a significant portion of respondents have made changes to their financial planning: 44% of respondents reported making major changes, while another 44% reported making minor changes. Only 9% of respondents reported not making any changes to their financial planning, while 3% reported not having made changes yet but planning to in the near future.
Among the respondents, 48% have reduced their spending in response to concerns about a potential recession. Followed by increased income (20%), tracking expenses while following a strict budget (24%), creating an emergency fund (3%), and paying off all high-interest credit cards, debts, etc. (1%).
There are significant concerns about how well governments and financial institutions will be able to handle any potential economic challenges raised by the prospect of a recession. Our survey results suggest that many respondents do not feel confident in their country’s preparedness: 34% felt that their country was very unprepared, while 28% felt that it was somewhat unprepared.
Meanwhile, 24% felt neutral about their country’s preparedness, and only 7% felt their country was somewhat prepared. Lastly, just 2% of respondents stated it was very prepared to manage a potential recession.
These findings imply that the population is generally concerned about preparedness and that governments and financial institutions may need further action to reassure the public and prepare for potential economic challenges.
Public Calls for Fiscal Stimulus, Support for Workers in the Face of Potential Recession
Furthermore, figure 3 reveals responses when asked what measures could be taken to mitigate the impact of a recession.
11% said providing fiscal stimulus, followed by the government should work closely with the Central Bank (7%), provision of support and subsidies to workers impacted by a recession (11%), regulatory changes (9%), and providing support for key industries that are vulnerable to a recession (8%).
In addition, 10% stated that the government could work with other countries and international organizations to coordinate a global response, and 12% said the government should prioritize investing in education, infrastructure, and other areas that can support growth.
Lastly, 12% suggested that the government should implement policies that promote consumer spending and increase demand for goods and services.
The last survey asked the opinions on the current global economic conditions. Results are as follows:
The current global economic conditions seem generally positive (25%), there are some ups and downs in the current global economy (31%), there are potential risks and challenges that could impact the growth (23%), the global economy is currently in a state of instability (12%), and there are both opportunities and risks in the current global economy (3%).
|Survey Title||Survey on the Possibility of an Economic Recession in 2023|
|Duration||March 04, 2023 – March 11, 2023|
|Number of Participants||10,000|
|Demographics||Males and females, aged 21 to 99|
|Participating Countries||Afghanistan, Algeria, Angola, Argentina, Armenia, Australia, Azerbaijan, Bahrain, Bangladesh, Belarus, Benin, Bolivia,… Brazil, Brunei, Bulgaria, Burkina Faso, Cambodia, Cameroon, Canada, Chile, China, China (Hong Kong) China (Macao), China (Taiwan), Colombia, Costa Rica, Croatia, Czech Republic, Ecuador, Egypt, El Salvador, Ethiopia, Finland, France, Gambia, Georgia, Germany, Ghana, Greece, Greanada, Guatemala, Honduras, Hungary, India, Indonesia, Iraq, Ireland, Israel, Italy, Ivory Coast, Japan, Jordan, Kenya, Kuwait, Kyrgyzstan, Latvia, Lebanon, Libya, Lithuania, Malaysia, Maldives, Maluritania, Mexico, Moldova, Mongolia, Morocco, Mozambique, Myanmar [Burma], Namibia, Nepal, Nicaragua, Nigeria, Oman, Pakistan, Palestine, Panama, Peru, Philippines, Poland, Portugal, Qatar, Romania, Russia, Saudi Arabia, Serbia, Sierra Leone, Singapore, Slovakia, South Africa, South Korea, Spain, Sri Lanka, Tanzania, Thailand, Togo, Tunisia, Turkey, Turkmenistan, Uganda, Ukraine, United Arab Emirates, United Kingdom, United States, Uruguay, Uzbekistan, Venezuela, Vietnam, Yemen, Zimbabwe.|
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