Another economic result for 2021 is out. Yet again, the Biden administration has failed to live up to expectations.
The Bureau of Economic Analysis revealed the GDP only grew by 2% in the third quarter of 2021. Besides, the result is coming after a September shambolic jobs reports in which the economy fell short of more than 60% of jobs forecasted.
Another economic failure for the Biden-Harris administration.
CNBC on Q3 GDP: “2.6% is what people were looking for…this is a disappointment of 2%.” pic.twitter.com/woSJTxcqTX
— America Rising (@AmericaRising) October 28, 2021
Comparing the 3rd Quarter GDP with Previous, Forecasted GDPs
The Gross Domestic Product (GDP) growth rate was slower than experts expected. Besides, the GDP grew at a rate of 6.3% in the first quarter and 6.7% in the second quarter.
The steady growth of 0.4% was a key factor in experts believing there would be an upward increase in the GDP as the economy continues to bounce back.
Breaking this morning, the GDP only grew 2% last quarter. What’s worse is that growing inflation and supply chain issues may very well make this quarter even worse. https://t.co/Mnzg8bS3gp
— Joe Cunningham (@JoePCunningham) October 28, 2021
However, one of the causes of slow GDP growth is the supply chain jam. Although this is a worldwide trend, alleviating the problem will do a lot of good for the Biden administration.
Besides, Republican governor of Florida, Ron DeSantis, said his state can help solve the issue. He noted the seaports in Florida are ready for all ships, while saying ships stuck in California can reroute to Florida.
Another possible cause behind the fall of the GDP is the COVID-19 delta variant. The variant has caused many hospitalizations and death since July.
Besides, death rates and hospitalizations due to the delta variant peaked in September, leading to slower economic growth. In addition, many business investments fell and household spending dropped significantly.
Moreover, chief economist at Moody’s Analytics, Mark Zandi, said the delta variant of COVID did a lot of damage to the economy. He stated the virus disrupted the global supply chains. He also said it scrambled production in many industries.
There’s Light at the End of the Tunnel
Although everything looks doom and gloom at the moment, there’s hope the country will bounce back as soon as possible. The country is already seeing a decline in COVID-19 cases. Aside from that, vaccination rates are increasing, which can potentially reduce the spread of the virus. Americans are now beginning to spend more money too.
Furthermore, airlines have reported an increase in passenger traffic. Not only that, but businesses are now spending more on wages and equipment. The high wage spending is a way for employers to entice workers who have left the labor market.
With all this mind, economists forecast the country will bounce back to a 6% growth in GDP by the next quarter. In addition, economists expect the 2021 GDP growth will be around 5.5%.
If this happens, it will be the highest calendar year increase since the 1980s. This will be an immense improvement from 2020’s 3.4% GDP growth.
In the end, there’s hope for the country. Economists and Americans are optimistic with America overcoming the pandemic, the country can bounce back and return to the position of strength it maintained in the past.