GDP Growth Sets Record, First-Time Unemployment Claims Fall

The economic news that came out Thursday was almost all good.

The U.S. Commerce Department said third-quarter gross domestic product rose at a 33.1% annual rate, easily the fastest quarter-over-quarter jump on record driven by a strong rebound in spending by both consumers and businesses.

Much of that came in the early summer when most states eased local stay-at-home orders as the COVID-19 bar was flattened.

It was also a time when $1,200 checks were sent to millions of Americans as stimulus money, a hike in unemployment assistance was provided and other steps were taken.

U.S. Secretary of Labor Eugene Scalia said the economic news shows “sustained momentum.”

“(It) confirms that our nation is bouncing back from the coronavirus pandemic faster than predicted,” Scalia said. “In the third quarter of 2020, real GDP grew at an annual rate of 33.1 percent, greatly surpassing the previous record for quarterly growth set in 1950. Total unemployment insurance claims in early October fell by more than 400,000, meaning that nearly 3.4 million people have come off of unemployment in September and early October.

“Our continued efforts to fight the virus, develop a vaccine, and support Americans who remain out of work will help us rebuild our economy stronger than ever,” he added.

The Labor Department also announced Thursday that some 751,000 people applied for first-time unemployment benefits last week. That’s some 40,000 fewer than the week before.

That number is more than triple what it was before the coronavirus outbreak.

First-time unemployment claims, by the numbers:

  • California had 152,057 first-time claims last week, down 7,800.
  • Illinois had 54,819 claims, an increase 7,871.
  • New York had 52,283 first-time claims, down some 2,600.
  • Massachusetts had 47,202 claims, up 1,798.
  • Georgia had 43,362 claims, down 1,530.

The total number of workers continuing to claim unemployment benefits also fell last week, to 7.7 million. Another 10.3 million people continue to claim unemployment under the Pandemic Unemployment Assistance program providing jobless benefits to workers previously not eligible for unemployment. “The economic recession is officially over but many are not thriving, they are just barely surviving,” Christopher Rupkey, managing director and chief financial economist at MUFG Bank in New York, said in the L.A. Times. “GDP growth is up today, but with a new surge in coronavirus cases nationwide to the highest new cases seen to date, one has to ask how long will this economic recovery be able to stay on track and put the millions of jobless Americans back to work.”