Forecasters downgraded their predictions for US economic growth, and more than half say there is a 25% probability of a recession happening this year, according to the “October 2022 Outlook” report released today by the National Association for Business Economics.

“NABE Outlook Survey panelists forecast slower growth and higher inflation in both 2022 and 2023 than they previously expected,” said NABE President David Altig, executive VP and director of research, Federal Reserve Bank of Atlanta.

The median forecast for inflation-adjusted gross domestic product now calls for growth of 0.1% in this fourth quarter. That’s down from 1.8% when the forecasters were last surveyed for the May 2022 report.

NABE’s report also found 87% of forecasters place a more than 25% probability of a recession occurring in 2023.

“More than three-quarters of respondents believe the odds are 50-50 or less that the economy will achieve a ‘soft landing,’” added NABE VP Julia Coronado, president and founder, MacroPolicy Perspectives LLC. “More than half the panelists indicate that the greatest downside risk to the US economic outlook is too much monetary tightness.”

Forecasters also expect growth in US nonfarm payroll to average an increase of 94,000 next year after averaging 353,000 this year. The median forecast calls for employment growth to slow each quarter through the second quarter of next year.

In addition, the median forecast calls for the US unemployment rate to increase to 3.7% by the end of this year and 4.2% by the end of 2023; both projections are higher than those in the May report.

Forecasters expect compensation — annual average per hour — to increase 6.3% this year. That’s also higher than the 5.4% projected in the May report.

NABE’ survey included 45 professional forecasters. It took place from Sept. 13 to Sept. 23, 2022.