The economy has been challenged and more so in recent months. Everyone is concerned and making provisions for a recession. But what made things better last year compared to now, 2024?
Consumers Did More Spending
Despite rumored recession whisperings, during 2023, consumers actually spent more than what they are now in 2024.
Rising Percentages
However, the economic growth was due to more purchases and credit by consumers.
GDP (Gross Domestic Product) Did Better
In light of the overall economy thriving, the GDP also increased by 3.3%, according to the chief economist from Moody Analytics, Mark Zandi.
The Perfect Report
Zandi also said, “It’s just a perfect report. Strong growth, low inflation.” He noted that all aspects, including business contractions, consumer spending, trade, government, and housing, were paying off in favor of growth.
Some Factors Influence to Customer Spend
The economy’s growth and thriving are partially due to consumer spending. At this time, consumers earned well and even saw an increase in wages for some. Better pay made more spending and doing more possible for American households and general consumers.
The U.S. President’s Speech Is Positive
“Wages, wealth, and employment were higher now than before the pandemic. That’s good news for American families and American workers.” President Joe Biden said in a speech.
Biden Administration Contribute to Economic Growth
Under the Biden administration, efforts to pursue green energy and create new jobs in telecommunications and other sectors had a positive effect.
New Jobs From Growing Economy
As a result, to actively improve economic growth through job creation, more people received work and input from private investors worth $640 billion.
International Monetary Fund
The International Monetary Fund (IMF) recorded statistics depicting a slowing economic growth of 1.4% in 2024. The statistics were expected for all stronger or advanced economies internationally.
Global Inflation Drops
The IMF also reported that Global inflation will dip by 5.8% in 2024. With that, core inflation is also expected to decline at a slower pace and is not expected to stabilize until sometime in 2025.
It’s Not All Good
A former Trump administration economic advisor, Joseph LaVogna said that “Growth may not be as strong as it appears” in reference to the economic boom. He also noted that “…government spending is keeping demand stronger than it would otherwise be.”
What About The Rest Of 2024?
Economists like Beth Bovino expect to see a recession within 2024. However, many economists, including Bovino, are hopeful that the country’s economy will stabilize even if it falls into a recession. “We expect growth to slow down in 2024, but job gains are holding up,” she said.
The Price Hike
Because of the economic progress after the pandemic and the recovery from the recession, many people started relying on credit. With inflation set to help mend the economy, consumers can expect to pay more and thus are slowing their spending ever so slightly.
Will Things Get Better?
Focus Economics says the United States economy does well because it’s developed with the world’s largest private-sector-led economy. The country also has a strong work sector compared to other strong economies.
Inequality on Salaries
Income inequality within various industries and peers is also higher than in other nations, which doesn’t positively contribute to the economy.
Challenges Are Ongoing
According to Focus Economics, income inequality, healthcare costs, unstable politics, climate change, and the aging senior population negatively impact the economy. Even a strong economy like the U.S. struggles to keep afloat when these challenges weigh it down.
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The content of this article is for informational purposes only and does not constitute or replace professional financial advice.
