This research was published on July 21, 2023

The U.S. economy has defied the doomsayers once again. More than a year has passed since a recession was seen as a foregone conclusion and a “soft landing” pronounced near impossible. But today, the soft landing is well advanced, even if not complete: The Fed has found success in lowering inflation without triggering a recession. The labor market, the only reliable evidence that the economy is in recession, has cooled without pushing up the unemployment rate.

Though this is welcome news, the protracted uncertainty surrounding the economy has confounded many leaders — and came at a cost for those who hunkered down prematurely in anticipation of recession. This uncertainty will persist. What comes after the soft landing (if in fact it can be completed)? To answer this question, we look at why the recession calls were wrong and what lies ahead.