The U.S. economy shrank by an annualized 4.8% in the first quarter, the government said on Wednesday.

Why it matters: It's the biggest quarterly drop in over a decade and shows the beginning of an economic slowdown that's expected to get worse as the coronavirus roils the economy. Economists are bracing for current quarter figures, with some projecting a record annualized decline of about 40%.

What they're saying: The coronavirus led to "rapid changes in demand, as businesses and schools switched to remote work or canceled operations, and consumers canceled, restricted or redirected their spending," the Commerce Department said in a release.

By the numbers: The biggest drag was the sharp drop in consumer spending, which makes up about 70% of U.S. economic activity.

It fell 7.6%, the most since 1980, per Bloomberg.

And business investment, which had already been sluggish in recent months, showed a quarterly drop of 8.6%.

Between the lines: The data is even worse "when you consider that the first two months of the first quarter were relatively normal and this number only includes the March lockdowns," Chris Zaccarelli of the Independent Advisor Alliance wrote in a note to clients this morning.

GDP estimates for the current quarter are dismal. At worst, economists say it could shrink by an annualized 41%, per FactSet.

The bottom line: The economy is undeniably in a recession, though official data is slow to confirm that. The Q1 contraction shows the beginning of the damage.