If you think the U.S. might finally be recovering from the economic morass brought on by the COVID-19 pandemic, you might be right.
According to a report from the U.S. Commerce Department, the U.S. economy grew at a 6.5% annual rate in the second quarter of 2021. According to Commerce, the size of the economy has now passed its pre-pandemic level.
That means the nation’s gross domestic product, which had already shown solid growth at 6.3% in the first quarter, accelerated the last quarter.
ABC News is reporting that second-quarter figure was less than the 8%-plus annual growth rate many economists had predicted. But the miss was due mainly to clogged supply chains related to the rapid reopening of the economy.
The Commerce Department reported that consumer spending surged again, advancing at an 11.8% annual rate, according to ABC. Spending on goods grew at an 11.6% rate, and spending on services, from restaurant meals to airline tickets, expanded at a 12% pace as vaccinations encouraged more Americans to shop, travel and eat out.
Companies, too, spent with confidence last quarter. Business investment surged at an 8% annual rate in the April-June quarter, adding 1.1 percentage point to GDP.
U.S. Secretary of Commerce Gina M. Raimondo called the GDP report “encouraging.”
“President Biden took swift, decisive action in his first 100 days to vaccinate Americans, deliver relief to families and businesses, and set the stage for a sustainable economic expansion for all Americans,” Raimondo said. “The President entered office with a plan to Build Back Better, and as he said last night, America is moving forward, but we can’t stop now. A simple bounce-back is not sufficient. We need the strategic investments included in the American Jobs Plan and American Families Plan to not only return to where we were prior to the pandemic, but to build our country and our economy back better.
“We need big, bold actions that invest in our families, our workforce, and our infrastructure that position America to out-compete on the global stage for decades to come,” she added.
Aiding with the recovery are the trillions of dollars in assistance from federal rescue programs, including stimulus checks and expanded unemployment benefits to small business aid to just-distributed child tax credit payments.
“Consumers are going to continue to drive the economic train,” Mark Zandi, chief economist at Moody’s Analytics, told ABC. “There is a lot of excess savings, a lot of cash in people’s checking accounts.”