The US Economy Health was supposed to improve in the latter half of 2020. However, the rapid spreading of the coronavirus did cause a massive downfall in the economy. The country imposed a lockdown, and although the situation is far better now, one question everyone is making is the economy is improving or declining.
The US economy status has always been on the top as the country falls in the strongest contenders list.
The US economy forecast did bring in a lot of hope, but whether it worked out is still a question. Owing to coronavirus, it seems as if the US is in recession in 2020. Furthermore, it is being anticipated that if the current economic situation in the US does not improve, there might be massive haywire.
Experts predicted that the US economy would improve in the second half of 2020. However, the financial outlook is supposed to see a massive change. Experts further indicated that there might be a U-shaped recession in 2020 with the US economic health going a sharp decline and then recovering.
What is the Current Economic Situation in the US?
Although the US’s economic trends showed that the second half would be better, the second quarter of the economic condition was far worse than the first.
The growth of the US economy health went down by 5.0%, acting as the first sign of the US recession 2020. The beginning of the recession brought about the contraction of the US economy by 31.4%. The third quarter did see major improvements, but they weren’t enough to cover up for the losses made in the first and second quarters.
According to the CBO predictions, the US economic status might not return back to its pre-pandemic scale until 2022. All non-essential businesses were closed in April, and hence the retail sales saw a massive decline of 14.7%. Millions of people became unemployed, which also had a huge negative impact on the economy.
The Bureau of Labor Statistics (BLS) is responsible for publishing the US’s financial outlook every year. The statistic report provides a complete insight into the job opportunities across different industries and occupations. According to the expectations, between the years 2019 and 2029, the employment rate will increase by more than 6 million.
Health care jobs are expected to rise by 3.1 million. However, jobs in the technology sector will also increase in the coming time. The BLS prediction suggests that the jobs regarding wind turbine technicians will increase in the span of ten years by 60.7%.
The manufacturing jobs will keep on the increase. However, for those in the retail sales sectors, the jobs will decrease, while the ones in the eCommerce jobs will continue to grow. This shift is expected to be seen in the transportation and warehousing sector as well. But, jobs in the postal and agriculture sector will decrease too.
Economic Trends in the US
The financial outlook of the US has seen a massive shift in the past few months. However, the recovery is expected to take longer than it was. If you are living in the US and want to secure your financial future, here’s everything you need to know
Climate Change is Causing Disasters
One of the recession facts that have affected the US economy health is climate change. The food prices are increasing with the increasing temperature in the country.
The rising sea levels are also posing the threat of flood in low lying areas. The increased risk of the flood can have a huge impact on the economy.
Moreover, the wildfires have increased at a massive rate in the past few years. The damage caused due to the changing climate is evident in Colorado, California, New Mexico, and Arizona.
US Economic Health is Declining in Global Power
Prior to the recession, the United States was the only superpower of power. However, after the recession, several other countries gave America tough competition in the run for global power. Countries like Brazil, China, Russia, and India have had a huge impact.
All these emerging countries successfully survived the great recession of 2009, while Europe and the United States’ economic outlook kept declining. Attacks on jobs outsourcing, free trade, and currency manipulation have had a huge impact as well. The leaders in the urge to stay in power have been fighting to keep up with the people’s necessities.
Central Banks May Shift to Neutral
In the coming years, it is being anticipated that central banks may shift to becoming neutral. The central banks work the short-term rates working at zero in the US. The negative territory of Japan and other European countries will easily be recovered. Nonetheless, the increasing size of the labor market can cause an increase in interest rates.
Millions of Americans have lost their jobs. The unemployment rate has increased a lot, especially in the industrial sector. Furthermore, it is being anticipated that more job openings will be laid down depending on the United States economic outlook.
The tame inflation has opened up sectors for a Federal Reserve to bring about the gradual approach to the normal level. This ensures a natural equilibrium is maintained. The policymakers will eventually increase rates because of severe inflationary pressure. According to the forecasts by Fed, resumes are likely to see a hike in 2021.
The Stock Market Strength
The stock market analysts are expecting to see a massive low in the US economy health, which may be historical.
The rise in equity last year had eventually played an important role in increasing the GDP. The capitalization of the market has contributed to meeting the size of the economy. But the prices are bringing in more profit. The investors are furthermore looking out for opportunities to enhance the United States economic outlook. The increasing consumer demand is bringing in more profit and the overseas revenue reflects that there might be no recessionary triggers.
Is the economy improving or decreasing? This is one confusion that one may feel because of improvements in the stock market.
Innovation and globalization are expected to bring improvements in the US economy health, which is increasing the value of the company.
Better Outlook Abroad
China and US trade relations and international issues are easing these days. Moreover, globalization is expected to improve wealth and opportunities. The labor demand is extremely high in the US which is paving new opportunities, especially for international expansion. Moreover, trade isn’t stopping.
Despite the economic trends of the US, globalization will continue to grow. In the coming century, the trend would aim at achieving living standards for developing countries the same as that of the developed countries.
The current state of the US economy is stable and not declining anymore. The retail stores across the country have been opened up to keep up with the US economy health.
The predictions at the beginning of 2020 are very different from what is happening now. The economy of the country is sure to improve but whether it will reach the pre-pandemic level and by when is still a question.