The economy has entered a period of supercharged growth, and instead of fizzling, it could potentially remain stronger than it was during the pre-pandemic era into 2023.
Economists now expect the second quarter to grow at a pace of 10%, and growth for 2021 is expected to be north of 6.5%. In the past decade, there have been few quarters where gross domestic product grew at even 3%. Forecasts for 2021 and 2022 were revised higher after Congress approved $1.9 trillion in fiscal spending, on top of an earlier $900 billion package late last year.
That money is now making its way through the economy. Bank of America’s credit card data shows a 67% surge of card spending over last year in the seven days ended April 3, fueled by government Covid stimulus checks and reopenings. But that compares to a bleak period when consumers were in lockdown and frightened by the spreading virus. However, spending is still up 20% over the same period two years ago.
“This economy isn’t coming back. It is back,” said Tom Gimbel, founder and CEO of LaSalle Network, a Chicago-based recruitment firm. The first signs of the economic blastoff showed up in March’s better-than-expected increase of 916,000 jobs.
