The American economy has been hit in the last quarter. The economy shrank by 9.5% between April and June. This is the first time the United States has plunged into recession in 11 years.
If the economy continues to decline at the same rate in the near future, there will be a fall of 32.9% on an annual basis. The lockdown have had a major impact on the American economy. Shops and restaurants were closed all over the country.
In addition, households also spent a lot less. Consumer spending is an important part of the economy in the US and it was precisely there that the biggest decline was seen.
The deteriorating economy is now also felt by many Americans. Unemployment has increased by at least one million a week in the last five months. Meanwhile, the unemployment rate in America is 11.1%.
More and more Americans are failing to pay their rent. The number of tenants thrown out on the street has been shot up. A lot of system errors are coming to light now. There is no safety net for most Americans, and we are beginning to see the consequences.
In the months of May and June things were slightly better, as a number of states decided to relax the coronation measures. Yet the worries are still great. Although Florida and Texas opened up the economy again, many older people still didn’t have the stomach for it. But young people did visit each other again, creating a new peak. First, the number of COVID cases must decrease, so that people can regain some confidence.
And that seems to be a big problem. Although Germany has even worse quarterly figures, the number of coronary thrombosis there is much lower than in March and April. In the United States, this is still growing.
The coronavirus has not yet been defeated. And while there is optimism about a vaccine, we still don’t know if it will work and when it will be available.