By Steve Dinnen
We’re slowing. Not dramatically, but as the U.S. economy matures and our country ages — hey, we’re 249 years old — we’re producing incrementally less.
Real gross domestic product growth for 2024 is expected to reach 2.8% after all the numbers are in the books. This is a respectable gain for the world’s largest economy.
But in the last two decades, U.S. growth rates have been decreasing, as they have in many other developed nations. In the 1950s and ’60s the average growth rate was above 4%. In the ’70s and ’80s, it dropped to about 3%. In the last 10 years, the average rate has dropped below 2%. With the exception of the pandemic bounce-back in 2021, it has never reached the 5% since the second quarter of 2000.
These statistics come from Trading Economics. I did some research and found that during the 1960s, the United States posted GDP gains of less than 3% in two years, but had more than 6% gains in three years. We had a painful recession in the mid-’70s, when GDP actually fell, but otherwise, 5% growth was the norm.
And so it has goes, but ever so slowly down. In the 2010s, there wasn’t a single year when GDP growth hit 3 percent.
The Federal Reserve of St. Louis looked at the downward GDP trend and noted that slowdowns of productivity and decline of factory utilization did little to help matters.
Still, even 2.8% growth is still growth. And 2025 goes forward, too. The current range of forecasts for U.S. economic growth is unusually wide, from 1.5% to 2.7%, and the U.S. Chamber of Commerce has rosily argued that 3% percent is likely. Goldman Sachs’ forecast is similar, at 2.5%, citing President Donald Trump’s policies of lighter regulation and lower corporate taxes as boosts to business activity but warning about lower growth if his tariffs cause a full-fledged “trade war.” Stay tuned on that.
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