How inflation affects you and the economy
In June, the Bureau of Labor Statistics (BLS) announced that inflation had increased 5.4 percent in the last 12 months. But even before that announcement, high and increasing prices were…
On October 29th, the Bureau of Economic Analysis (BEA) released GDP growth estimates for the third quarter of 2020. According to the data, GDP grew at an annual rate of 33.1% in the third quarter nationally. This was credited to the continued reopening efforts that were taking place all around the country.
Recently, the BEA released estimates for state GDP growth in the third quarter. According to the new data, GDP increased in all 50 states. This again is a testament to the reopening efforts that were happening around the country after the initial lockdowns that started in March.
According to the BEA, “Healthcare and social assistance; durable goods manufacturing; and accommodation and food services were the leading contributors to the increase in real GDP nationally”. Accommodation and food services, for example, grew 344.5% nationally and was the leading contributor to GDP increases in 5 states, but also contributed to growth in all 50 states.
In the third quarter, Minnesota grew at 36.3%, slightly higher than the national average. In this period, we saw Governor Walz lift restrictions on the leisure and hospitality industry, albeit with some restrictive rules.
As I wrote before,
What this new data shows, more than anything else, is the fact that it is the shutdowns that have had the biggest threat to the economy, not the virus itself. It is no coincidence that the economy is growing just after states have eased their restrictions on businesses and individuals. It is safe to say that if states can steer away from imposing the draconian shutdowns that characterized the second quarter, there should not be too much worry about the economy veering off its course of recovery.
With the current restrictions, Minnesotans should be concerned about the future of the state’s recovery. Covid-19 restrictions have been the big killer of jobs and businesses, and they have done nothing for Minnesota’s recovery.