GDP Slows to 2.4 Percent in the Second Quarter
The latest economic report on gross domestic product shows the pace of the nation’s recovery slowing to 2.4 percent from 3.7 percent in the first quarter. Factors contributing to the second-quarter slowdown included only modest growth in consumer spending and less support from inventories.
The Bureau of Economic Analysis report also shows a surge in imports, highlighting the fierce competition that U.S. manufacturers face in selling products overseas and in the domestic market, says the National Association of Manufacturing. NAM officials say the U.S. needs a comprehensive manufacturing strategy to create jobs and make America more competitive.
“There is a great deal of uncertainty in today’s business environment—from tax, trade and energy policy to health care reform and new regulations—and this uncertainty is hurting manufacturers’ ability to create jobs,” says NAM President and CEO John Engler.
NAM economist David Huether notes some good news in the latest report, including an increase of 10.3 percent in exports, most of which are manufactured products. This represents the fourth consecutive quarter of double-digit export growth, a feat that has not been accomplished in more than two decades.
Additionally, business investment rose a solid 17 percent in the second quarter, mainly driven by a 22 percent increase in purchases of equipment and software, Huether says. This increase is an important sign that while a slowdown may continue during the next several quarters, businesses are making some capital purchases.