A growth recession is an economic situation in which the Gross Domestic Product (GDP) growth rate slows down significantly, but the economy is still growing. In other words, it is a period when an economy is expanding, but at a pace that is slower than its potential growth rate or the growth rate needed to reduce unemployment.
During a growth recession, businesses may experience lower demand for their products or services, leading to lower profits, layoffs, and lower consumer confidence. This can further dampen economic growth and lead to a prolonged period of slow growth or even a recession.
Unlike a traditional recession, which is characterized by a contraction of the economy, a growth recession is marked by a slowdown in the rate of expansion. It is often seen as a warning sign of a potential downturn in the future if the underlying causes of the slowdown are not addressed.