A period of general economic decline. Contractions are often part of a business cycle, coming after an expansionary phase and before a recession.

Use contraction in a sentence

The contraction period was hard on us all, but we were all very glad that it was finally coming to an end.

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My company decided to lower its expenses and not hire as many people because we feared the economy was not growing and was in a period of contraction.

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boom and bust cycle irrational exuberance