Definition of slump

The origin of the word "slump" can be traced back to the mid-19th century when it was initially used to describe a sudden and unexpected downward movement or fall of a deep-shaft mine. The term stemmed from the German word "Sfrom" meaning "slack" or "laxity," which was used by miners to describe a collapse of roof supports caused by the weakening of the underground strata. The use of the word "slump" to describe a downturn in economic activity emerged in the late 1800s. It was first applied to the iron and steel industries, where cyclical low points were referred to as "slumps" due to some of their parallels to the instability noted in mining operations. Over time, the word's definition evolved and expanded, covering various areas of commerce and finance such as stock prices, employment, and trade flows. Generally, a slump refers to a downward trend or a prolonged period of economic stagnation characterized by low levels of output, sales, and financial returns.