U.S GDP Falls 9.5 Percent During Coronavirus Pandemic — Economic Contraction Worst on Record

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Thursday, July 30, 2020

GoLocalWorcester News Team

The United States Commerce Department announced Thursday that Gross Domestic Product (GDP) fell 9.5% in the second quarter of 2020.

That drop equals an annualized pace of 32.9%, the Commerce Department’s initial estimate showed.

Axios reports:

"Why it matters: Widespread lockdowns to contain the spread of the coronavirus pandemic from ravaged the economy in a way that's never been seen in modern times, and hope for a swift recovery has been dashed as cases have surged nationwide.

Between the lines: The staggering contraction beats the last record set in 1958, when GDP shrank at an annualized 10% rate.

The big picture: The GDP report puts a number on the unprecedented damage we saw playing out in real-time from April to June: millions of jobs lost, tens of thousands of shuttered businesses and a record halt in activity.

'As horrific as the GDP number is, it's basically reporting something that we all already knew — that economic activity came to a screeching halt as the virus altered the contours of our lives. Millions lost their jobs, and the real issue is how our economy recovers,' economist Justin Wolfers tweeted.

More recent data shows a renewed economic slowdown alongside worsening outbreaks across the country."