The economy grew 5.7% in 2021, the fastest rate since 1984, as the country shook off the worst of the pandemic, the Bureau of Economic Analysis reported Wednesday.
The numbers, adjusted for inflation, were in part fueled by a surprisingly strong fourth quarter. The gross domestic product grew at a robust 6.9% annualized rate to close out the year, which was far stronger than the growth in the third quarter and better than forecasters had expected.
The GDP numbers released Wednesday, which are the third and final estimate, are sure to be touted by President Joe Biden as proof that his COVID-19 mitigation legislation and economic agenda have been a success, although Republicans will point out that despite the powerful growth, the country is mired in the worst inflation it has faced in decades.
The omicron variant of COVID-19 overlapped with the end of the fourth quarter but appears to have been little more than a speed bump along the country’s economic recovery after the deadlier delta variant slowed growth over the summer.
RECORD-LOW NUMBER OF UNEMPLOYED WORKERS PER JOB OPENING
COVID-19 has been in rapid decline since mid-January, when new cases peaked at about 800,000 per day. New cases are now averaging less than 30,000 per day, an 11% decrease from two weeks ago. Hospitalizations and deaths have also declined by 35% and 40%, respectively, during that same period.
After posting good numbers in January, the economy once again exceeded expectations in February and added 678,000 jobs, another hopeful sign that the labor market is returning to its pre-pandemic strength and a fact that bolsters Wednesday’s GDP report.
Additionally, the unemployment rate ticked down to 3.8%, the Bureau of Labor Statistics reported earlier this month — the lowest since the start of the pandemic and near the lowest levels of the past half-century.
Still, inflation has become a growing source of concern for the country. Consumer prices increased 7.9% for the 12 months ending in February, the fastest rate since 1982.
A poll released this week found the share of people saying inflation is the country’s leading problem has more than doubled in the last three months, and that dissatisfaction has eaten into Biden’s approval ratings and undercut support for his ambitious tax and spending agenda.
CLICK HERE TO READ MORE FROM THE WASHINGTON EXAMINER
The Federal Reserve announced earlier this month that it would raise its interest rate target by a quarter of a percentage point, the first such move in years, in an effort to curb inflation.
Fed Chairman Jerome Powell has also indicated that the central bank might be forced to move even more aggressively than previously thought to tame the rising prices, a prospect that could ding economic growth.
