The US economy contracted in 2020 to its worst performance since World War II, as Covid-19 ravaged services activities, causing millions of Americans to lose their jobs and enter poverty lists.
A preliminary reading from the US Department of Commerce of GDP in the fourth quarter of last year showed that the recovery from the pandemic has lost momentum in light of the renewed growth in Coronavirus infections and the end of government aid of about three trillion dollars.
The economy shrank 3.5 percent in 2020, the worst performance since 1946, after growing 2.2 percent in 2019, the first annual drop in GDP since the recession between 2007 and 2009.
In the fourth quarter, gross product increased at an annual rate of 4 percent, as the virus and the absence of another financial package undermined consumer spending and overshadowed the strength of manufacturing and housing market activity.
And because of that big setback after a historical growth rate between July and September, output fell from its level at the end of 2019.
With the virus not yet contained, economists expect a further slowdown in the first quarter of 2021 before accelerating again by the summer with the adoption of additional stimulus and the vaccination of more Americans.
The continuing weakness in the labor market highlights the growing poverty. In a separate report on Thursday, the US Department of Labor said that 847,000 submitted new applications for government unemployment benefits last week, noting that the economy lost jobs in December for the first time in eight months, and did not recover Only 12.4 million of the 22.2 million jobs were lost in March and April.