The common term for a significant decline in economic activity lasting more than a few months is a recession.
A recession is a broad contraction in economic activity. In the United States, the National Bureau of Economic Research’s Business Cycle Dating Committee traditionally looks for declines spread across the economy and visible in measures such as real GDP, income, employment, industrial production, and sales.
The often-repeated rule that two consecutive quarters of falling GDP automatically equal a recession is only a rule of thumb, not the NBER’s formal approach. The committee weighs depth, duration, and diffusion together, so a short but exceptionally severe downturn can qualify even if it does not fit that simple quarterly pattern.
A depression is generally understood as a much more severe or prolonged contraction, while deflation means a sustained decline in the general price level. Stagflation is a different condition: it combines weak economic performance or high unemployment with elevated inflation. Recessions may involve deflationary pressure, but the terms are not interchangeable.