U.S. GDP growth: signs of economic recovery
The other day the White House presented a forecast for the development of the economy, which will begin a gradual recovery. The 2nd quarter was unsuccessful for the segment – a decline of about 37.7% was recorded. At the same time, analysts point out the U.S. GDP growth by 21.5%.
The data show that the economy will start to gain momentum after a catastrophic collapse due to the coronavirus pandemic. Experts note that the 3rd quarter is characterized by positive dynamics and has all chances to be the most successful period in the history of the state. Such results will allow us to cover the fall, which was observed in the 2nd quarter. In the first quarter, a 5% drop in GDP was recorded, which was the highest over the past 6 years.
However, despite the optimistic forecasts, there are a number of problems in the country, one of which is the unemployment rate, which is at 15% and approximately the same and will remain until the end of the period.
The outlook for the 2nd quarter from the Federal Reserve was disappointing. Representatives of the main regulator spoke about a decline in GDP around 20-30%, and unemployment will reach 20-25%. However, at the end of the specified months the losses for the economy were not so serious, although they showed the vulnerability of the American system and weaknesses that need to be worked on.
During quarantine measures in the United States, more than 42 million people applied for unemployment benefits from the civil service. The peak of fuss was observed in March, when 6.9 million Americans applied for financial aid in just one week. At the end of May, this figure was at 2.1 million people. Now the number of applications continues to decrease, and a total of 21 million people in need receive benefits. In comparison, before the pandemic, only a few hundred thousand unemployed people applied for benefits per week. At the same time, the number of jobs in the State increased by several million annually. In April, there was a record decline in the labour market, with employees being laid off twice as many as during the 2008 crisis. According to experts’ analysis, the recovery of the segment will be long and will continue until 2030.
The situation in the USA is worsening and the protests that took place in June practically all over the country. The reason for clashes with law enforcement officials was the murder of a black man in detention – he was suffocated by a policeman who made the arrest, which was not carried out according to the law.
The coronavirus pandemic has caused enormous damage not only to the U.S. economy, which is considered one of the strongest, but also to other countries. According to IMF experts’ estimates, the global economy will decline by 3% by the end of this year.