U.S. economy has a long way to go until full recovery
The United States is rebounding from the pandemic much faster than the analysts initially expected. Experts think that the U.S. economy soared at an annualized rate of 6.5% in the first three months of this year. While it’s faster than the 4.3% growth recorded at the end of 2020, it’s still slower than the enormous 33.4% rally in the second quarter of 2020 when the American economy started to reopen.
U.S. gross domestic product grew on average some 2.5% per quarter on an annualized basis before the pandemic. However, during the pandemic, GDP contracted at a record pace. Currently, growth rates look exceptional thanks to the substantial stimulus aid bills and vaccine rollouts.
Despite that, if we look at GDP in dollars, instead of just examining the percentage change, it will be more obvious that the U.S. economy is still struggling. It will take much more time to recover its pre-pandemic strength.
Still, businesses are reopening, and consumer demand is increasing. In manufacturing, companies are already struggling to meet demand due to supply and shipping shortages. For industries that require social interactions, including restaurants and traveling, the vaccine rollout is crucial.
People are optimistic about the U.S. economic recovery
Recent surveys show that Americans believe in the fast economic rebound. With improved sentiment, consumer spending is also soaring. The Conference Board’s consumer confidence index jumped to 121.7 points in April, reaching its highest level since February 2020.
Millions of U.S. citizens lost their jobs during the height of the Covid-19 pandemic. Still, many have found a new job again. Stimulus checks from Washington have also helped consumers be more confident about the future.
Furthermore, people who have been working throughout the pandemic managed to save a lot of money last year. They had few opportunities to spend money outside the home due to strict lockdowns. Analysts expect healthy consumer spending with the economy’s reopening.
