U.s. Economy grows in first quarter despite pandemic

u.s. economy grows in first quarter despite pandemic

Despite the corona crisis, the u.S. Economy grew solidly in the first quarter. In the first three months of the year, economic output increased by 6.4 percent on an annualized basis, according to data from the U.S. Government.

In the USA, quarterly growth figures are always extrapolated for the year. This indicates how the economy would develop if the pace of growth were to continue for a year. In europe, this method is not used, which is why the figures are not directly comparable with each other.

The situation on the labor market of the major economy has also improved somewhat. In the week ending 24. In april, the number of initial applications for unemployment assistance fell again, but only slightly by comparison.

The number of requests for assistance fell by 13.000 to 553. 000, according to the US department of labor. It’s the third downturn in a row. In the meantime, requests for aid have reached a level that is lower than at any time since the beginning of the corona crisis. Initial applications for unemployment benefits are considered an indicator of short-term developments on the labor market.

Due to the corona crisis, the u.S. Economy collapsed to a historic extent last year. Economic output shrank by 3.5 percent in 2020. This was the sharpest decline since 1946 after the end of the second world war. In the first half of 2020, most economists had expected an even worse slump, but the economy stabilized again in the second half, not least thanks to extensive stimulus packages.

Most forecasts expect the U.S. Economy to grow by 6 to 7 percent overall this year. According to analysts, the main reasons for the rapid economic recovery are the vaccinations and the corona stimulus package recently passed by congress, worth around 1.9 billion us dollars. This is equivalent to almost ten percent of annual economic output in the u.S. Last year, congress had already introduced packages with a volume of around 3 billion dollars.

Unemployment rate now down to 6 percent after a pandemic high of nearly 15 percent last year. According to the head of the central bank, jerome powell, there are still 8.4 million fewer jobs overall than before the crisis. Before the pandemic came to a head last march, the u.S. Economy was still booming.

No country in the world has been hit as hard by the pandemic in absolute terms as the u.S. So far, authorities in the country of around 330 million people have reported more than 32 million confirmed infections and more than 574,000 deaths.

When he took office in january, the new U.S. President joe biden gave priority to the fight against the pandemic and accelerated the vaccination campaign by taking a number of steps.

According to the CDC, around 30 percent of the entire population in the USA is now fully vaccinated: more than 37 percent of adults and more than 68 percent of the over-65s. More than half of all adults in the u.S. Have received at least one vaccine dose, and 82 percent of seniors have received at least one vaccine dose. The rapid progress of the vaccination campaign in the u.S. Has raised hopes of some return to normal economic life.

Biden has also unveiled other massive investment plans. In addition to a rough infrastructure package, his administration also wants to push through a sustainable expansion of social services for families and education. Both packages together were projected by the weiben house to cost about $4 billion over the next ten years. However, congressional approval is still uncertain.

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