US GDP Current Statistics

What Made the U.S. Economy Contract a Record 31.7% in Q2 2020

Retail worker stocking a store full of clothing products
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The current U.S. GDP growth rate is -31.7%. That means the United States economy contracted at a rate of 31.7% in the second quarter of 2020. The second quarter is April through June. That's the worst quarterly contraction in U.S. history. The second-worst contraction was 10.0% in the first quarter of 1958.

The National Bureau of Economic Research declared that a recession began in February 2020.

The U.S. economy is well below the ideal growth rate of between 2% and 3%. That rate is fast enough to provide sufficient jobs, but not so fast it will create inflation or an asset bubble.

The economy contracted in the first half of 2020 because of the COVID-19 pandemic.

The current U.S. gross domestic product annual rate is $19.487 trillion as of the second quarter. In other words, if all the companies and people in the United States kept producing at that rate for a year, they'd make $19.487 trillion in goods and services.

For a wider comparison, we tracked the growth rate from 2007 to 2020. The grey bar shows the ideal growth rate between 2% and 3%.

Revision Schedule Estimates

The Bureau of Economic Analysis releases the GDP report at the end of each month. Each quarterly report has the following three releases:

  1. Advance Estimate: Released one month after the quarter ends. It's often wildly different from the Third Estimate, simply because all of the trade and business inventory data is not in yet.
  2. Second Estimate: Comes out two months after the quarter. It's more realistic.
  3. Third Estimate: Released three months after the quarter. Usually only tweaks the Second Estimate. 

The BEA makes in-depth revisions annually. Here is the recent schedule:

  • July 29, 2018: All estimates since 1929 based on improved estimates
  • July 29, 2019. All estimates since Q1 2014
  • July 30, 2020. All estimates since Q1 2015
  • The next revision will be July 29, 2021

Current and Recent U.S. GDP

For each quarter below, you'll see the most recent estimates first. That's followed by prior estimates. Admittedly, this presentation is a little confusing, but it's important to see how the data continually changes. A record of these revisions isn't readily available anywhere else.

2020

Q2: -31.7%

The largest component of GDP is consumer spending. It contributes almost 70% to the economy. In Q2, it plummeted by 31.4% as consumers sheltered in place to avoid the coronavirus pandemic. Spending on durable goods fell by 1.3%. That's for long-lasting things like automobiles, furniture, and large appliances. Spending on non-durable goods fell by 14.9%. Sales to services fell by 43.1% as restaurants, gyms, and hairdressers were closed.

Business investment fell by 46.2%. Investment in equipment fell by 35.9%. Commercial construction, which is mostly apartment buildings, dropped by 33.4%. Residential construction fell by 37.9%, making many people wonder if the real estate market will crash.

Exports fell by 63.2%. Most of U.S. exports are oil and commercial aircraft. Both of these industries were hard-hit by the pandemic. Imports fell by 54% as countries around the world also shut down.

An increase in exports increases GDP, while an increase in imports lowers it. As the dollar's value strengthens, it makes exports more expensive.

Federal government spending rose by 17.6%, partly because of the CARES Act and other stimulus packages. State and local spending fell by 5.5% as revenues also fell. States and cities, unlike the federal government, must keep a balanced budget.

The BEA's Advance estimate was 32.9%.

Q1: -5.0%

The BEA's Third Estimate said GDP was -5.0%. Consumer spending fell by 6.9%. Spending on durable goods plummeted by 12.5%. That's for long-lasting things like automobiles, furniture, and large appliances. Spending on non-durable goods rose by 7.1%. Sales to services fell by 9.8%.

Business investment fell by 9.0%. Investment in equipment fell by a whopping 15.2%. Commercial construction, which is mostly apartment buildings, fell by 3.7%. Residential construction rose by 19.0%.

Exports fell by 9.5%. Imports fell by 15.0%. Federal government spending rose by 1.6%. State and local spending rose by 1.1%.

The BEA's Advance Estimate was -4.8%. Its Second and Third Estimates were both -5.0%. 

2019: 2.2% (Was 2.3% in Original Estimate)

Nominal GDP Components 2019
GDP Component Q1* Q2* Q3* Q4*
Personal Expenditures $14.266 $14.511 $14.678 $14.795
Business Investments   $3.783   $3.749   $3.745   $3.698
Exports  -$0.633  -$0.662  -$0.653  -$0.578
Government   $3.683   $3.742   $3.722   $3.814
Total $21.098 $21.340 $21.542 $21.729

*In trillions of dollars.

Q4: 2.4% (Was 2.1% in Original Estimate)

Consumer spending rose by 1.6%. Durable goods orders rose by 3.1%, while those for non-durable goods fell by 0.7%. Spending on services rose by 2.0%.

Business investment fell by 3.7%. Investment in equipment fell by 1.7%, while commercial construction fell by 5.3%. Residential construction rose by 5.8%.

Exports rose by 3.4%, while imports fell by 7.5%. Federal government spending rose by 4.0% thanks to military spending, which increased by 6.6%. State and local spending rose by 1.5%.

The BEA kept its estimate at 2.1% for the advance, second, and third estimates.  

Q3: 2.6% (Was 2.1% in Original Estimate)

Consumer spending rose by 2.7%. Spending on durable goods rose by 6.3% and non-durable goods by 3.1%. Spending on services rose by 2.0%.

Business investment rose by 1.8%. Investment in equipment fell by 1.7%, while commercial construction rose by 3.6%. Residential construction rose by 4.6%.

Exports rose by 0.8% while imports increased by 0.5%. Federal government spending rose by 4.8%, driven by a 5.6% rise in military spending rose. State and local spending rose by 0.6%.

The BEA's advance estimate was 1.9%, while the second estimate was 2.1%.  The third estimate was 2.1%.

Q2: 1.5% (Was 2.0% in Original Estimate)

Consumer spending rose by 3.7%. Spending on durable goods rose 12.7%, while spending on non-durable goods rose by 5.3%. Spending on services increased by 1.9%. Business investment fell 5.8%. Investment in equipment was down 3.8%, while commercial construction was up 1.6%.  

Exports fell by 4.5% while imports rose by 1.7%. The trade war is decreasing all aspects of international trade. Federal government spending rose 9.2%, boosted by a 4.4% increase in military spending. State and local spending rose by 2.6%.

The BEA's advance estimate was 2.1%, while the second estimate was 2.0%. The third estimate was 2.0%.  

Q1: 2.9% (Was 3.1% in Original Estimate)

Consumer spending rose by 1.8%. That's typical for the first quarter because it's right after the holiday shopping season. Spending on durable goods rose by 1.0%. Spending on non-durable goods rose by 3.3%. Spending on services rose by 1.5%.

Business investment rose by 3.9%. Investment in equipment increased by 2.0%, while commercial construction rose 8.2%. Residential construction dropped 1.7%.

Exports rose by 1.8% while imports fell 2.1%, which adds to GDP. Federal government spending rose by 1.3% even though military spending rose 5.6%. State and local spending rose by 3.2%.

The BEA's advance estimate was 3.2%, while the second estimate was 3.1%. The third estimate was 3.1%.  

2018: 3.0% (Was 2.9% in Original Estimate)

Q4: 1.1% (Was 2.2% in the Original Estimate)

  • Advance: The advance report was not released due to the government shutdown.
  • Second: The BEA's estimate was 2.6%.
  • Final: Robust business and government spending made up for moderate consumer spending. Total growth was 2.2%.

Q3: 2.9% (Was 3.4% in the Original Estimate)

  • Advance: The economy grew by a robust 3.5%. It was driven by consumer spending, commercial real estate, and government spending.
  • Second: The BEA kept its estimate at 3.5%.
  • Final: The BEA revised the estimate down slightly to 3.4% based on updated data.

Q2: 3.5% (Was 4.2% in the Original Estimate)

  • Advance: GDP rose by 4.1%. The economy was boosted by growth in consumer spending, commercial real estate, exports, and government spending.
  • Second: The BEA revised its estimate up to 4.2%. Commercial real estate construction was a little higher than originally estimated.
  • Final: The BEA confirmed its estimate of 4.2%.

Q1: 2.5% (Was 2.2% in the Original Estimate)

  • Advance: Real GDP increased by 2.3%. Contributions came from consumer spending, commercial real estate, and government spending.
  • Second: The BEA revised its estimate down a bit to 2.2%. It based the revision on new data on personal consumption expenditures and inventory investment.
  • Final: The BEA revised its estimate down to 2.0%.
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