A Recession Is Brewing At The Bottom Of The K-Shaped Economy

Article Synopsis

The long-anticipated post-COVID recession hasn’t officially arrived, but lower-income households are already experiencing recession-like pressure. With rising costs, fading pandemic-era financial cushions, and inflation stuck around 3%, affordability has become a growing strain for millions. 

Economist Mohamed El-Erian warns that this segment is nearing a recession, and weakening spending at the bottom of the “K-shaped” economy could have ripple effects across the broader market. Recent private-sector data showing rising layoffs and only modest job gains adds to concerns about the labor market’s true health.

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