How Are We Doing?
Hearing that U.S. real GDP growth for the first quarter was 3.2%, I wondered how well we were doing.
We can look at past recessions to assess 3.2%. Looking back to the early 1980s, some economists say they were hoping for better. Like a “V”, when a recession is pretty steep, usually, so too is the recovery. For 2nd quarter 1983, after the 1980 and 1982 “double dip”, we jumped to 9.7% real GDP growth. By contrast 2010 projections are for 3.1%.
We can also look at other countries. According to a recent IMF report, compared to developing nations and the emerging economies, our 3.1% projected recovery is “tepid”. China’s projected growth rate for 2010 is 10%; India’s is 8.8%; Brazil’s is 5.5%. However, when we look at the EU, we are doing okay. Their projected real growth rate is 1.0%.
Finally, we can consider unemployment rates. Projections for 2010 are: U.S.: 9.4%; Germany: 8.6%; Greece: 12%; Spain: 19.4%; Japan: 5.1%.
The Economic Life
GDP is a measure of the money value of new goods and services produced in a country during one year. The unemployment rate is the number of unemployed in a labor force divided by the size of the entire labor force.