BCG Henderson Institute

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This research was published on December 12, 2022, on Fortune

As the year comes to an end, the customary flow of economic outlooks is in full swing. Many outlooks are looking for something to break in the economy, yet the most obviously broken thing is the economic outlook itself.

2020 outlooks were quickly dismantled by COVID, and 2022 outlooks were shredded by Russia’s war in Ukraine–but it’s not just exogenous shocks that undermine outlooks. As the economy weathered blows this year, prominent voices spoke of economic “hurricanes” or prematurely declared the U.S. in recession. However, as the year closes out, we’re looking at an economy with many strengths, even though macroeconomic headwinds remain exceptionally strong.

If outlooks fail so often, how can we plan for 2023? Rather than asking whether there will be a recession, executives and investors are better off asking what would cause it. Shifting from point forecasts to frameworks organizes risks, considers multiple future scenarios, and grounds us to react more calmly when shocks do hit. No framing is a crystal ball. It cannot lower the very real risk of recession, but it can achieve more nuance than the gloom that has let down many forecasts in 2022.