Recession in any economy, like it presently in Nigeria is simply a slowdown or massive contraction in economic activities.

It's a significantly declines in economic activities which may last for some quarters thereby completely hampering the growth of an economy.

Signs of a Recession


Recession occur when there are several quarters of slowing but still positive growth in an economy.

Some time a quarter of negative growth occur, then a positive growth for several quarters, and the third quarter became negative growth.

When there are declines in consumer demand which brings about slowing growth leading to drops in real GDP, income, employment, manufacturing, and retail sales.

A decline in GDP growth is also a sign that a recession may be underway.

Causes of a Recession

High interest rates:
When interest rate is high it limit the amount of money available to invest. Hold to the fact that the profit might not pay back the interest rate.

A decline in manufacturing orders:
Orders from consumers for durable goods will start to drop.

Deregulation in the Country's financial institution, such as restrictions on loan-to-value ratios for the banks.

Slowdown after a war, usually after war the economic activities is not expected to start functioning as SE sector had to be restructured.

Credit crunch, value of the country's currency.

Consequences of Recession

When recession occur businesses go bankrupt, people lose their homes when they can't afford to pay.

Graduates can't get a good job after school. That throws off their entire career.

Unemployment:
Unemployment is usually high during a recession because most company, industries tends to layoff worker in order to survive.

Business:
Recession leads to fall in productivity as consumers demand is affected by their purchasing power.

Social effects:
Increase in activities such as Prostitution, ....


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