dcsimg

Economic Growth At Highest During Fourth Quarter 2011 But Still Bumpy

January 27, 2012

GrowthWhile the economy experienced the highest amount of economic growth in the fourth quarter of all last year, economists are still saying that the road ahead could be bumpy.

On the positive side, the 2.8 percent in economic growth experienced from October to December 2011 was the fastest seen since the spring of 2010, reported The Washington Post. The increase also follows three quarters of growth with rates below two percent. However, economists are saying economic growth needs to be higher to help offset unemployment rates.

Alan Krueger, chairman of the White House Council for Economic Advisers, agreed. "While the continued expansion is encouraging, faster growth is needed to replace the jobs lost in the recent downturn and to reduce long-term unemployment," he said in Bloomberg Businessweek.

In fact, many economists indicate that the U.S. must have continual growth of at least 2.5 percent to help decrease unemployment rates, The Washington Post noted.

According to a survey of conducted by Reuters, some economists had hoped for 3 percent growth in the last quarter of 2011.

"Though the unemployment rate has improved, the jobs market remains a major challenge," Adolfo Laurenti, deputy chief economist at Mesirow Financial in Chicago, told Reuters. "The high level of people out of the workforce and underemployed people show there isn't really much income generation to contribute to a better spending pattern."

Consumer spending plays an important part in U.S. economic growth, accounting for up to 70 percent of the country's economic activity, Reuters noted. Consumers did appear to spend more in the fourth quarter of 2011 especially when it came to obtaining new vehicles. The Japanese earthquake and subsequent tsunami caused a delay in delivery of vehicles, which could be the reason for the fourth quarter uptick.

The fourth quarter increase was also an improvement over the third quarter rate of 1.8 percent. However, the newest report of numbers did cause a slight dip in U.S. stocks, long-ranging Treasury debt prices and the value of the dollar.

"We're still repairing the damage done by the financial crisis," U.S. Treasury Secretary Timothy Geithner was quoted in Reuters as saying at the recent World Economic Forum. "On top of that, we face a more challenging world. We have a lot of challenges ahead in the United States."


Compiled by Maggie O'Neill

Sources:

"Growth Quickens, But Speed Bumps Ahead," reuters.com, January 27, 2012, Lucia Mutikani

"Obama Pushes Payroll Tax Cut as GDP Growth Trails Forecasts" businessweek.com, January 27, 2012, Roger Runningen

"U.S. GDP Grew At Fastest Pace in 1.5 Years in Fourth Quarter 2011," washingtonpost.com, January 27, 2012, Peter Whoriskey

Career and Education News

Find a school near you

Our News Writers and Editors

CityTownInfo Writers and Editors

Follow CityTownInfo.com

Follow Us on Facebook
Follow Us on Twitter
Follow Us on Youtube

Career and College Resources on CityTownInfo

Real-World Career Reports

Career Stories from workers: daily activities, job tips, best/worst job aspects, training, etc.
Daily Career & Education News from our staff. We're an approved Google News provider!

Career References and Original Articles

Resource Center. A starting point for all CityTownInfo career and college resources.
Career Overviews of hundreds of careers: descriptions, salaries, forecasts, schools, more.
Best Careers Not Requiring Degrees: Good pay, job growth, low need for degrees.
Helpful Articles, many in "how-to" format; e.g., "How to Become a Chef".
Infographics covering employment and educational trends.

College Directories and Lists

These lists link to thousands of detailed school profiles.

Colleges by State. Nearly every college and trade school in the country.
Colleges Listed Alphabetically. About 7,000 colleges & trade schools, including online schools.
Colleges by Major City. Browse cities with multiple college options.
Online Colleges. Colleges with online degree programs.
Graduate Schools by State. Colleges offering graduate degree programs.
Graduate Schools by Major City. Find cities with multiple graduate school options.
Back to Top
SPEAK TO AN ADVISOR 1.844.285.6104