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Oct. 30, 2020
By Mary HightowerU of A System Division of Agriculture
(417 words)(Download this story in MS Word format here.)
FAYETTEVILLE, Ark. — The U.S. gross domestic product grew 33.1 percent from the second
quarter this year, making up nearly all the ground lost to impacts of the COVID-19
pandemic in the second quarter, according to the October report from the Commerce
Department’s Bureau of Economic Analysis.
The report is one of the most widely anticipated and scrutinized due to its timing,
which every four years, puts it just days before the presidential election.
“This is quite an impressive rebound from the 31.4 percent decline in real GDP in
the COVID-interrupted second quarter,” economist John Anderson said. “However, it
is important to recognize that the big percentage gain in GDP from the second quarter
drop is not the same thing as a full recovery from the COVID shock.”
Anderson is head of the agricultural economics and agribusiness department for the
University of Arkansas System Division of Agriculture and the Dale Bumpers College
of Agricultural Food and Life Sciences. He has been providing pandemic-related analyses
of the economy since March.
“The aggregate economy remains smaller than it was pre-COVID, something that’s clear
with a look at the raw numbers,” he said.
The third quarter GDP amounted to $18.584 trillion. “By way of pre-COVID comparison,
real GDP in 2019 amounted to $19.092 trillion,” Anderson said. “The economy therefore
remains about 2.7 percent below its 2019 level: a strong recovery over a short time
frame, to be sure, but not yet a full recovery.”
Consumers are spending
Anderson said consumer spending “increased sharply in the third quarter on both goods
and services, with the largest gains on durable goods. For the most part, spending
on goods, both durable and non-durable, has eclipsed pre-COVID levels by a significant
Spending on services increased in the third quarter but were still lower than pre-pandemic
levels. Transportation, recreation and food services, plus accommodations “are still
a long way from a full recovery despite a strong third quarter rebound,” he said.
Pandemic-induced work-from-home culture did help one sector: software and information
processing equipment. “Both are now larger than they were before the pandemic,” Anderson
said. “Given the investments throughout the economy on remote communication capabilities,
that should not be too surprising.”
Even though the economy remains in recession, “the lion’s share of second quarter
losses have been recovered despite the ongoing negative effects of COVID on economic
activity and the significant slowing of direct government support to both individuals
and businesses, he said.
See Anderson’s analysis at https://bit.ly/3kKKx56.
To learn more about extension and research programs in Arkansas, visit https://uada.edu/. Follow us on Twitter at @AgInArk, @uaex_edu or @ArkAgResearch.
About the Division of Agriculture
The University of Arkansas System Division of Agriculture’s mission is to strengthen
agriculture, communities, and families by connecting trusted research to the adoption
of best practices. Through the Agricultural Experiment Station and the Cooperative
Extension Service, the Division of Agriculture conducts research and extension work
within the nation’s historic land grant education system.
The Division of Agriculture is one of 20 entities within the University of Arkansas
System. It has offices in all 75 counties in Arkansas and faculty on five system campuses.
The University of Arkansas System Division of Agriculture offers all its Extension
and Research programs and services without regard to race, color, sex, gender identity,
sexual orientation, national origin, religion, age, disability, marital or veteran
status, genetic information, or any other legally protected status, and is an Affirmative
Action/Equal Opportunity Employer.
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Media Contact: Mary HightowerChief Communications OfficerUniversity of Arkansas System Division of Agriculture firstname.lastname@example.org 501-671-2006