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GDP report: Coronavirus-induced fall is one for history books

U.S. economic output fell at a stunning 32.9% annual rate in the second quarter — a level not seen since the Great Depression and by far the largest drop since government record-keeping began in 1947, according to data released Thursday.

The sharp contraction, reflected in the government’s report of gross domestic product, came on the heels of a 5% decline in GDP during the first quarter and marked what most economists predict will be the bottom of the coronavirus-induced recession that officially began in February. The new numbers on GDP — the sum of all goods and services produced in the country — include data from the mini-recovery that occurred before the latest surge in the COVID-19 pandemic.

Now with the coronavirus rampaging over large areas of the country, measures of consumer spending, small-business activity and job openings are slowing again, casting a shadow over economic conditions many Americans will face as election day draws near.

A separate report Thursday from the Labor Department showed new unemployment claims rose last week to 1.43 million. It was the second straight week of increase — following about three months of steady declines — and brought the total number of people who have applied for jobless benefits since mid-March to more than 54 million, which is about a third of the American labor force.

Taken together, the new economic reports point to significant hurdles for President Trump in his reelection bid and lend fresh urgency to lawmakers who are wrangling over provisions to provide another round of support to the economy.

The nearly $3-trillion worth of pandemic relief measures approved earlier by Congress have clearly buoyed the economy, but the effect of those initial programs is ebbing.

Many

Article source: https://www.latimes.com/politics/story/2020-07-30/coronavirus-induced-collapse-in-gdp-is-one-for-the-record-books

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