LINCOLN- A team of state economists has labeled 2023 year as the likely time for a state and nationwide recession. Multiple interest rate increases failed to slow inflation, experts find it unlikely that these will increases will make a true change in the upcoming future, said Eric Thompson, an economist who directs the University of Nebraska-Lincoln’s Bureau of Business Research.

The elevated interest rates during 2023 will likely mean less consumer spending, home-buying and business investment, leading to job losses and a recession. “The most likely event is a recession, although it is possible we will have a soft landing” and narrowly avoid an economic decline, Thompson said.

Thompson thinks it could be avoided based on how many jobs employers hoard, and the direction of rent prices in the future. Personal income for Nebraskans is forecast to grow by 4.2% during 2023, slightly below the expected 4.5% rate of inflation. If a recession does occur, it is not expected to be severe or long-lived, with employment growth expected to return in 2024 and 2025.

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