Key Highlights
- Commerce Department reports annualized economic expansion of 6.4% in Q1 2021
- Labor Department reports decreasing initial jobless claims
Economy Picks Up in Q1 2021
The US Commerce Department just reported that the economy grew +1.6% in Q1 2021 compared with 1.1% in Q4 2020.
This +1.6% growth in Q1 2021 translates into an annualized rate of +6.4%.
Economic Activity Running on “All Cylinders”
Scott Anderson, chief economist with Bank of the West in San Francisco, said, “We’re running on all cylinders in terms of economic activity. People are anxious to get out and return to their normal lives, and there’s pent-up demand…(along with) roughly $2T in excess savings.”
Anderson expects overall economic activity to come back to pre-pandemic levels in Q2 2021. On the other hand, Anderson anticipates the labor market to take until late 2022 before jobs fully recover.
Speaking of Jobs
The US Labor Department reported a decrease of 9,000 filings of initial claims for state unemployment benefits last week. This latest weekly decrease, the third in a row, brought the number down to 575,000.
New claims filed for the federal Pandemic Unemployment Assistance program this last week came in at 122,000.
Daniel Zhao, senior economist with Glassdoor, said, “We’re not quite at a full reopening yet, but the light is there at the end of the tunnel.
Indeed’s economist AnnElizabeth Konkel said, “The labor market is definitely moving in the right direction…(however)we are still in a pandemic – the vaccinations are ramping up but…we’re not quite there yet.”
Thanks to The New York Times.
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