The Commerce Department released a prepared report Thursday showing that the U.S. economy grew year over year, but it did not make up for a poor first quarter and a historically record drop in the second quarter.
For 2020 as a whole, GDP was down 3.5 percent from a year earlier. It was the worst decline since 1946 It was the first decline in U.S. GDP since 2009, when the figure fell 2.5% during the financial crisis. In other words, U.S. GDP at the end of 2020 was 20.9 trillion, down from 21.4 trillion a year earlier.
Between April and June, GDP declined by a record 31.4% after the initial lockdown. In the next three months, the figure returned at an annualized record 33.4%, but it still wasn’t enough to make up for the damage already done.
Federal Reserve Chairman Jerome Powell confirmed Wednesday that the U.S. economic recovery remains dependent on the spread of the virus. Across the country, communities remain under various isolation protocols to help contain the spread of the disease, and economic activity is adversely affected. In addition, millions of people remain unemployed as a result of the pandemic, which has hit industries based on social contact.