The US economy emerged from the pandemic even more quickly than previously reported, revised data from the federal government shows.
The Commerce Department on Sept 26 released updated estimates of gross domestic product over the past five years, part of a long-standing annual process to incorporate data that isn’t available in time for the agency’s quarterly releases.
The new estimates show that GDP, adjusted for inflation, grew faster in 2021, 2022 and early 2023 than initially believed. The revisions are relatively small in most quarters, but they suggest that the rebound from the pandemic – already among the fastest recoveries on record – was stronger and more consistent than earlier data showed.
Perhaps most notably, the government now says GDP grew slightly in the second quarter of 2022, rather than contracting as previously believed. As a result, government statistics no longer show the US economy as experiencing two consecutive quarters of declining GDP in early 2022 – a common definition of a recession, though not the one used in the United States. (The revised data still shows that GDP declined in the first quarter of 2022, but more modestly than previously reported.)
The official arbiter of recession in the United States is the National Bureau of Economic Research, a non-profit research organisation made up of academic economists. The group defines a recession as “a significant decline in economic activity that is spread across the economy and lasts more than a few months”, and it bases its decisions on a variety of indicators including employment, income and spending.
Few economists in 2022 believed that the US economy met the requirements for a recession. But many feared it was headed for one because of the Federal Reserve’s aggressive efforts to bring down inflation with high interest rates. Instead, growth quickly resumed
