Nearly half the 22 million jobs lost in March and April remain unfilled and the unemployment rate remains at 7.9%, more than double its pre-pandemic level as 12.6 million Americans are still out of work. Counties won by Democratic President-elect Joe Biden make up 70 percent of all U.S. economic output—or gross domestic product (GDP)—a new post-election study finds. GDP (constant 2010 US$) GDP (current US$) GDP (constant LCU) GDP: linked series (current LCU) GDP, PPP (constant 2017 international $) GDP (current LCU) GDP, PPP (current international $) GDP per capita growth (annual %) Download. It has the world's fifth-highest per capita GDP (nominal) and the seventh-highest per capita GDP (PPP) in 2020. Media: (703) 993-4881, Holbert L. Harris Chair of Economics at George Mason University, The PPP Loan Program Left Too Many American Small Businesses Out to Dry, The U.K.’s Response to Covid-19 Has Been World-Class. The latest numbers show economic output surged by an annualised 33% in the third quarter of 2020, following a record fall as a consequence of the coronavirus pandemic. For all those reasons, our estimate is conservative and could be considered the upper bound of estimates of the slowdown. The GDP release came just five days before Election Day, which culminates a heated battle between President Donald Trump and his Democratic challenger, former Vice President Joe Biden. The mitigation measures adopted—a partial economic shutdown and social distancing—will exact a heavy cost on society that is not yet known. Follow everything happening at the Mercatus Center from week to week by subscribing to This Week at Mercatus. Used in combination with county data on infections—hospitalizations, recovery, and mortality rates—our estimates could help inform a mitigation strategy that differentiates across regions. To measure digitalization, we use the share of information-technology-intensive workers in a given industry relative to the industry’s total workforce. Fourth, and not surprisingly, we find that counties with a larger share of workers in nontradable sectors are also more heavily affected because those sectors are less diversified and more exposed to local shocks. His research focuses on the areas of labor and organizational economics, the digital economy and cybersecurity, and household finance and well-being, with a driving commitment to understanding how individuals and firms respond to large-scale change, particularly social and technological. Shepherdson expects the consumer and business investment rebound that led Q3 to "rise much less quickly" in the final three months of the year. As a result, federal debt held by the public will hit 98 percent of GDP in fiscal 2020, which ends on Sept. 30, and exceed the size of the economy by 2021, the CBO reported in updated projections. Gross Domestic Product of United States grew 7.5% in the third quarter of 2020 compared to the previous quarter. Online tool for visualization and analysis. The current U.S. gross domestic product (GDP) growth rate is 33.4% for the third quarter of 2020. Each week, we will send you the latest in publications, media, and events featuring Mercatus research and scholars. Economic activity was strong in the real estate sector, and consumer and business executive surveys showed that confidence has remained high despite virus-related setbacks. Got a confidential news tip? The Gross Domestic Product (GDP) in the United States was worth 21427.70 billion US dollars in 2019, according to official data from the World Bank and projections from Trading Economics. We want to hear from you. CSV XML EXCEL. This is lower than the long term average of 29.09%. It is the world's largest economy by nominal GDP and net wealth and the second-largest by purchasing power parity (PPP). Our estimates are based on recently released data on real GDP (at 2012 prices) between 2000 and 2018 from the Bureau of Economic Analysis. "National Data: National Income and Product Accounts: Table 1.1.5 Gross Domestic Product." For example, data on online reviews (e.g., Yelp) or online food delivery (e.g., Caviar) could provide the utilization rate of the food services sector, as well as a way of gauging economic activity in real time. Rather than classifying certain industries as “directly affected” by COVID-19, we use the digital-labor intensity of each industry to quantify the varying effect across industries. Second, we did not account for intersectoral linkages and nonlinearities, which have been important in understanding historical business cycles. Though most of the country remained in a cautious reopening, shoppers began returning to stores and the bar and restaurant industry entered the first tepid phase of resuming business despite restrictions on capacity. For simplicity, we use the 2001–2018 trend for each county and industry pair. Goldman Sachs estimates an annualized 9 percent decline in real GDP in Q1 of 2020 and an annualized 34 percent decline in Q2 owing to the COVID-19 pandemic, comprising a deannualized total COVID-19 impact on GDP of more than 10 percent. source: World Bank 10Y 25Y It's an increase of 0.03 percentage points from the third quarter second estimate. Our early estimates and future improvements and refinements could help with the management of this crisis. The powerful growth pace came after states across the country shut down large swaths of activity in an effort to stem the spread of Covid-19, which the World Health Organization declared a pandemic on March 11. The economy has been in a technical recession since February, as first-quarter growth declined at a 5% pace. "Absent new stimulus, and with Covid infections spreading rapidly, we're sticking to our 4% forecast for Q4 growth, though the margin of error here is large at this point," he added. WDI Tables. The debt grew under Reagan, who ushered in massive tax cuts, and it surged under Obama, who used federal stimulus funds to aid the economy during … ", For his part, Biden noted that while the economy improved "visits to food banks haven't slowed, and poverty has grown.". GDP rises 2% in United States in third quarter. These complementarities could deepen the downturn that we estimated. US GDP Growth Rate table by year, historic, and current data. Increased consumption along with sold gains in business and residential investment as well as exports fueled the third-quarter rebound. The gain came after a 31.4% plunge in the second quarter and was better than the 32% estimate from economists surveyed by Dow Jones. List of U.S. states, federal district, and territories by GDP (millions of current dollars) Rank State federal district or territory GDP in the 3rd quarter of 2020 % of Nation GDP per capita Region — United States: 21,170,252: 100.00: 63,565: 1 California: 3,120,386: 14.7: 79,261: West: 2 Texas: 1,772,132: 8.4: 60,357: South: 3 New York: 1,705,127: 8.1 For example, declines in employment among food and hospitality sectors may lead to lower real incomes for workers in those industries, who in turn will have less to spend on other goods and services in the arts, entertainment, or even manufacturing sectors. Get the latest in research, commentary, and more from Mercatus scholars. Current US GDP Growth Rate is -1.78%. That impact varies by industry, and we are able to identify this variation by adopting a simple but plausible assumption: industries will remain in business in proportion to their degree of digitalization. That's according to the third quarter third estimate from the Bureau of Economic Analysis (BEA). One strength of our estimate is that we are adding geographical granularity that could be important when authorities seek to modulate the intensity of mitigation measures to the needs of individual counties. Its overall score has decreased by 0.2 point due primarily to a lower trade freedom score. Personal savings also declined but remained strong at a 15.8% rate, down from the record 25.7% in Q2. For a visual county-to-county comparison, we offer a heat map that shows our estimate of penalties on growth for each county (figure 2). While the headline number "looks spectacular," it still leaves growth 3.5% beneath its level at the end of 2019, according to Ian Shepherdson, chief economist at Pantheon Macroeconomics. Moreover, these effects are unevenly distributed across sectors; for example, consumption on restaurant spending fell by a third, whereas credit-card and grocery spending increased significantly. In order to fill this information gap, we provide here a back-of-the-envelope estimate of the impact of current mitigation measures on the 2020 GDP growth rate. That was better than the 32% estimate from a Dow Jones economist survey. Thus, the economic cost of two months of mitigation measures is $2.14 trillion (10 percent). Sign up for free newsletters and get more CNBC delivered to your inbox. Christos A. Makridis is an assistant research professor at the W. P. Carey School of Business at Arizona State University, a digital fellow at the Sloan School of Management at MIT, a nonresident fellow at the Kennedy School of Government at Harvard University, and a nonresident fellow at the Institute for Religious Studies at Baylor University. Trump has promised a return to the strong growth prior to the pandemic, while Biden has accused the Republican incumbent of taking a thriving economy into a ditch due to mismanagement of the virus. Hartley graduated from University of Chicago with a BA in economics and mathematics with honors, and from the Wharton School at the University of Pennsylvania with an MBA specializing in finance and business economics. The previous post-World War II record was the 16.7% burst in the first quarter of 1950. Therefore, the economic cost of the first two months spent fighting the pandemic will be $2.14 trillion (10 percent), which is surprisingly close to the static fiscal cost of the CARES Act. Other estimates are even more severe, predicting as much as 18 percent shrinking of manufacturing output. Our estimates are based on recently released data on real GDP (at 2012 prices) between 2000 and 2018 from the Bureau of Economic Analysis. "It's obviously good news that the economy bounced back in the third quarter," said Eric Winograd, senior economist at AllianceBernstein. If the partial economic shutdown extends beyond two months, we foresee the need to adjust our estimate for the multiplier effect of delayed investments of physical and human capital. Data is a real-time snapshot *Data is delayed at least 15 minutes. NOTE: The information regarding Military expenditures - percent of GDP on this page is re-published from the CIA World Factbook 2020. This rate is 165 -tenths of one percent higher than the figure of -9% published in the second quarter of 2020. This penalty translates into a lower growth rate for the latter low-digitalization industries than the expected growth without the pandemic; if the expected growth rate were 2 percent, then a one-month shutdown means the first industry would shrink a little (−0.78 percent = 2 − 2.78), and the second industry would shrink a lot (−3.56 percent = 2 − 5.56). The one-month partial shutdown means we apply a penalty to the 2020 GDP of 2.78 percent (1/12 × [1 − 2/3]) for the first industry and 5.56 percent (1/12 × [1 − 1/3]) for the second. "This is going to be seized upon by both ends of the political spectrum as either evidence of the strength of the post-lockdown economic rebound or a cursory warning that the gains could be short-lived," said James McCann, senior global economist at Aberdeen Standard Investments. First, we estimate the 2019 real GDP since these data have not yet been made available at the county level. Online tool for visualization and analysis. The stimulus programs that provided much of the economic lift last quarter have expired or are expiring. Q3 growth came amid a resurgence in consumer activity, which accounts for 68% of GDP. US GDP Contraction Revised Lower for 2nd Time 2020-09-30 United States GDP Growth Rate On the expenditure side, personal consumption expenditures accounts for 68 percent of total GDP out of which purchases of goods constitute 23 percent and services 45 percent. Real gross domestic product (GDP) increased at an annual rate of 33.1 percent in the third quarter of 2020, as efforts continued to reopen businesses and resume activities that were postponed or restricted due to COVID-19. Watson Institute for International & Public Affairs. Real economic growth probably will rise by 2.8 percent* (annualized rate) in 4Q20 while the US economy continues to wrestle with the COVID-19 pandemic. Markets reacted positively to the news, with Wall Street erasing a loss at the open and turning mostly positive. Second, we forecast 2020 GDP by discounting a monthly penalty on each county’s growth rate. We also examine the cross-sectional relationship between declines in county GDP and various county characteristics: median income, college attainment, and participation in international commerce (tradable sector). Under these assumptions, we estimate a 5 percent decline in real GDP growth for every one month of partial economic shutdown. Local Phone: (703) 993-4930 - Graph and download economic data for Federal Net Outlays as Percent of Gross Domestic Product (FYONGDA188S) from 1929 to 2019 about outlays, federal, Net, GDP, and USA. Gross domestic product shrank 9.5% in the second quarter from the first, a drop that equals an annualized pace of 32.9%, the Commerce Department’s initial … The United States’ economic freedom score is 76.6, making its economy the 17th freest in the 2020 Index. Our key assumption is that industries will remain productive in direct proportion to their degree of digitalization because at least that portion of their workforce can continue working from home and contribute services that do not depend as much on in-person interactions. First, we did not model substitution between brick-and-mortar and online goods and services. We observe that counties with higher shares of digital workers are less affected by the pandemic, reflecting our assumption that industries in which employees can work from home suffer less disruption. DataBank. According to data from the Bureau of Economic Analysis (BEA), this deceleration in the recovery follows a contraction of 5.0 percent in 1Q20, a contraction of 31.4 percent in 2Q20 and a rebound of 33.1 percent in 3Q20. No claims are made regarding the accuracy of Military expenditures - percent of GDP information contained here. Decreases in government spending following the expiration of the CARES Act rescue funding subtracted from GDP. A direr economic forecast of the effects of the lockdown estimates that there could be an annualized 10 percent decline in real GPD in Q1 of 2020 and an annualized 63 percent decline in Q2, comprising a deannualized total COVID-19 impact on GDP of approximately 25 percent. While the news on Q3 was good for the $21.2 trillion economy, the U.S. faces a tougher road ahead as coronavirus cases increase and worries grow over the health and economic impacts. He has also worked in various government roles at the US Congress Joint Economic Committee, the Federal Reserve Bank of New York, and the Federal Reserve Bank of Chicago. The economy contracted 4.8% in Q1 in seasonally-adjusted annualized terms (SAAR), according to an advance GDP estimate released by the Bureau of Economic Analysis. 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