U.S. GDP Growth and Initial Jobless Claims Bring Small Smiles

The AEC Lens

Alex Carrick, Chief Economist at ConstructConnect
Alex Carrick is Chief Economist for ConstructConnect. He is a frequent contributor to the Daily Commercial News and the Journal of Commerce. He has delivered presentations throughout North America on the Canadian, United States and world construction outlooks. A trusted and often-quoted source for … More »

U.S. GDP Growth and Initial Jobless Claims Bring Small Smiles

January 29th, 2021 by Alex Carrick, Chief Economist at ConstructConnect

Article source: ConstructConnect

There have been two important U.S. economic data releases today: (1) advance estimates of Q4 and full year 2020 gross domestic product (GDP) growth; and (2) the latest weekly initial jobless claims number.

Both are set out in the standalone graphs below.

U.S. ‘real’ (after adjustment for inflation) GDP was +4.0% period to period annualized in Q4 2020, not so bad considering it was down by nearly a third (-31.4%) in 2020’s Q2.

More interesting, though, annual 2020 GDP was -3.5% vs 2019, not as steep a decline as was expected back in the Spring of last year.

In fact, -3.5% appears tame when compared with -11.6% in 1946, when WWII weaponry production ceased, and -12.9% in 1932, during the cold heart of the Great Depression.

Also, initial jobless claims delivered a result that was modestly upbeat. The latest weekly number on first-time unemployment insurance seekers moved in the right direction again, downwards.

It fell by -67,000 to 847,000, after climbing back up near a million in the prior week.

The number of ongoing UI recipients also took a step back, from 4.974 million to 4.771 million.

With a few fortuitous breaks along the way, especially on the vaccine roll-out front, 2021 may serve up a whole lot smoother ‘ride’ than we experienced in 2020.

Graph 1: U.S. ‘Real’ GDP Growth, Y/Y & Q/Q

‘Real’ is after adjustment for inflation.

Data source: Bureau of Economic Analysis (BEA).
Chart: ConstructConnect.

Graph 2: U.S. Initial Jobless Claims Weekly ‒ as of January 23, 2021

For the week ending Jan 23, 2021 = 847,000. The prior week's figure, after being revised slightly downwards, was 914,000.

Data source: Department of Labor.
Chart: ConstructConnect.

Category: ConstructConnect

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