U.S. Economy is Slowly Bouncing Back
November 4, 2020 – Alliance to Save the American Dream
As businesses push to reopen and consumer spending continues to increase, the U.S. economy is experiencing a v-shaped recovery, according to White House economist, Joe LaVorgna.
Following the Commerce Department’s third-quarter gross domestic product calculation, data shows that the U.S. economy grew at a record pace. GDP, the measure of goods and services produced, rose by 33.1% on an annualized basis from July to September, surpassing expectations by economists.
Despite the growth, the economy is still 3.5% smaller than it was at the end of 2019 and the previous quarter contraction’s detrimental effects are still being felt by Americans and businesses across the country.
LaVorgna, the chief economist of the National Economic Council, said in an interview with Fox Business that GDP “also captures investment spending and what we saw were some really strong durable goods orders.”
He further explained that durable goods are “items that last more than three years” and include “things that companies invest in, whether it’s computers, or mainframes, laptops, storage, all those sorts of things that anyone uses to operate a business. Those are accelerating and that does jive with what’s happening on the labor side, which is a real big pick up in hiring.”
The Commerce Department data is also suggesting that quarter 4 will also represent solid growth and production increases will lead to a surge in hiring.
According to the Brookings Institute, the economy was growing at an annualized pace of 2% to 3% prior to the pandemic.
The data does present a promising road to recovery and growth as 2020 comes to an end.
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