The Compound and Friends · Monday, July 13, 2026
Nick Colas discusses the unusual lack of recessions in the US over the past 15 years, attributing it to a shift towards a services-based economy and more responsive policy interventions. He highlights that factors like oil shocks, which previously triggered recessions, have less impact now due to the economy's reduced energy intensity.
“Over the last 15 years, we've had a recession in the US for just over two months, one percent of the time during the pandemic crisis. In the prior 15 years, we had recession 14 percent of the time. In the 15 years before that, it was 13 percent of the time. So we have literally no recession for the better part of 16 years now.”
“The first is we have a very services-based economy in the US, much less cyclical than the old manufacturing economy that we had in the 70s, 80s and 90s. We transitioned to services, services are less cyclical.”
“Oil shocks cause recessions less frequently.”