The U.S. economy grew 1.6 percent over the first three months of the year as American consumers began to emerge from COVID-19 isolation and the federal government has injected trillions of stimulus spending to offset high unemployment and business losses.
The first quarter’s growth would be 6.4 percent at an annual rate, although there are no guarantees that a quarter’s growth will continue for an entire year. However, the data released today by the Bureau of Economic Analysis (BEA) has economists optimistic about a faster-than-expected recovery for the pandemic-ravaged U.S. economy.
BEA attributed the first quarter growth to a bump in consumer spending, the reopening of businesses and continued government response to the pandemic. Consumer spending makes up almost 70 percent of U.S. economic output.
“We need to get used to seeing some big numbers, but also knowing to put them into context,” Wendy Edelberg, director of the Hamilton Project and a former chief economist at the Congressional Budget Office, told The Washington Post. “There’s been nothing normal about this recession and there will be little that’s normal about the recovery.”
After the economy shrank by 3.5 percent last year, its worst performance since the end of World War II, gains have been steady. The first quarter’s pace was the second-fastest GDP growth pace since the third quarter of 2003 and follows a 4.3 percent rate in the fourth quarter of 2020.