The Bureau of Economic Analysis reported today that consumption, savings, and product buying has changed and dropped dramatically with the Gross Domestic Product in the second quarter of 2020, to a historic rate of 32.9 percent, the lowest number in the history of recording.
The decline in second quarter GDP reflected the response to COVID-19, as “stay-at-home” orders issued in March and April were partially lifted in some areas of the country in May and June, and government pandemic assistance payments were distributed to households and businesses.
This led to rapid shifts in activity, as businesses and schools continued remote work and consumers and businesses canceled, restricted, or redirected their spending.
The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the second quarter of 2020 because the impacts are generally embedded in source data and cannot be separately identified.
The decrease in real GDP reflected decreases in personal consumption expenditures (PCE), exports, private inventory investment, nonresidential fixed investment, residential fixed investment, and state and local government spending that were partly offset by an increase in federal government spending.
The decrease in PCE reflected decreases in services (led by health care) and goods (led by clothing and footwear).
The decrease in exports primarily reflected a decrease in goods (led by capital goods). The decrease in private inventory investment primarily reflected a decrease in retail (led by motor vehicle dealers).
The decrease in nonresidential fixed investment primarily reflected a decrease in equipment (led by transportation equipment), while the decrease in residential investment primarily reflected a decrease in new single-family housing.
To add insult to injury, the weekly jobs report by the United States Department Of Labor recorded another 1.4 million filing for unemployment thanks to COVID19, totaling to 54 million in over 19 weeks.