Economic Recession in 2023

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By Emma Wu

The COVID-19 pandemic has interrupted all of our lives in a variety of ways. It has had social, physical, and economical impacts on our health and society. During the COVID pandemic, many people lost small businesses due to the lockdowns. With lack of clients and customers, people were not making enough money to pay for their expenses, thereby causing the loss of many shops and small businesses. In order to respond to this problem, the government printed large amounts of money for distribution among the people. However, this solution caused a host of problems as well.

By increasing the amount of money within the circulation of the economy, the government then created a large vacuum for inflation. As such, prices and costs of materials, items, and products grew significantly. Thus, even with more money distributed, the price of items also increased significantly. With a growth in money supply, comes sustained inflation. This sustained inflation began two years ago and is continuing, due to the COVID pandemic. However, as the pandemic recedes, money supply has ceased to flow. This sets the ground for an economic slowdown. Economic slowdown does not necessarily entail a recession, however it indicates a deduction in growth. However, with the sustained inflation that is still currently happening, a deduction in economic growth will significantly affect many people’s abilities to purchase and cover their expenses. Put simply, a continued increase in prices paired with a deduction money supply will collapse the economy. This is the economic recession that has been predicted by economists in regards to the year 2023.