In a statement last week, Jack Kleinhenz, Chief Economist for the National Retail Federation, believes the U.S. economy’s growth rate is slowing, yet consumers have remained financially healthy.

Kleinhenz does not believe a recession is a foregone conclusion, stating, “I am not betting on an official recession in the near term, but the most recent research pegs the risk over the next year as about one in three, and it will be touch and go in 2023. In the meantime, a contracting economy short of a recession is not out of the question.”

When announcing increased interest rates last month, Federal Reserve Chair Jerome Powell said, “We are not trying to induce a recession now, let’s be clear about that. We are trying to achieve two percent inflation consistent with a strong labor market,” which would include higher unemployment.

Job openings, quit rates, unemployment rates, and payroll growth remain steady and point to a tight labor market, while employment gains and rising wages suggest continued household spending.