Economic Update Spring 2023
Kevin M. Bahr CBEI Chief Analyst; Professor of Business Sentry School of Business and Economics
The economic ups and downs of 2022 continued through spring 2023. Inflation remains relatively high, but decreasing, interest rates continue to climb, the labor market remains strong, and slowing economic growth fostered uncertainty regarding future growth. In addition, spring 2023 witnessed a major bank failure and continues to endure the unresolved debt ceiling saga. This report will provide a brief look into the performance of the major economic benchmarks and issues that occurred in spring 2023. Economic Growth in Historical Perspective The table below provides U.S. economic growth since 1990. Economic growth is measured by changes in the Gross Domestic Product (GDP), which is the value of goods and services produced in the U.S. over a stated time period. The best years for economic growth, when growth was 4.0% or greater, are highlighted in yellow. Negative growth years are indicated in red.
Annual U.S. GDP Growth (Source: Bureau of Economic Analysis)
2020
2021
2022
-2.8
5.9
2.1
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2.7
1.5
2.3
1.8
2.3
2.7
1.7
2.2
2.9
2.3
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
4.1
1.0
1.7
2.8
3.9
3.5
2.8
2.0
0.1
-2.6
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
1.9
-0.1
3.5
2.8
4.0
2.7
3.8
4.4
4.5
4.8
Summarizing economic growth since 1990: 1990s – After a slow start, the internet and technological innovation fueled the strongest decade for economic growth with four years exceeding 4%. 2000s – After strong growth to start the century, the economy slowed significantly due to downturns in manufacturing and technology combined with Sept. 11. Economic growth recovered but was short lived as the financial crisis took hold in late 2007. 2010s – The longest period of economic growth in U.S. history, but it was a long period of generally low economic growth. Economic growth never exceeded 3%. A temporary boost in 2018 due to tax cuts but economic growth slowed in 2019. 2020s – 2020 worst year for economic growth since the post-World War II economic contraction in 1946; 2021 was the best year for economic growth since 1984. The 2020 economic decline was staggering relative to the financial crisis. During the financial crisis, approximately 8.7 million jobs were lost over two years . During the COVID crisis in 2020, 22.3 million jobs were lost over two months . Economic growth was mixed in 2022, with quarterly growth and declines.
Central Wisconsin Report - Spring 2023
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