The COVID-19 Contraction

by | Jul 16, 2020 | Uncategorized

The United States Bureau of Economic Analysis issued its report on the Gross Domestic Product (GDP) by State for the 1st Quarter of 2020. The report, which covers January through March, is the first report to show the impact of the COVID-19 pandemic on the U.S. economy.

NJCOVID19

Top 5 sectors that have contributed to the decline of real GDP nationally:
  1. Accommodations and food service (down 26.8%);
  2. Finance and insurance (down 9%);
  3. Health care and social assistance (down 7.8%);
  4. Arts, entertainment and recreation (down 34.7%);
  5. Agriculture, forestry, fishing and hunting (up 15.5%).
“New Jersey’s output in the first quarter was sadly, more or less in line with the nation. Our real GDP fell at a 5.5%  annual rate; a bit lower than the national decline of 5.0%, but quite different than New York’s nation-leading 8.2%. Our performance was a bit softer than the nation’s simply because we shut down earlier than most, so sectors such as real estate (which is largely estimated from sales transactions) and wholesale and retail trade fell more than elsewhere, and unlike some states in the Great Plains there was no support from agriculture. New York was much weaker due to a collapse in finance and construction,” stated Dr. Charles Steindel, former Chief Economist of the State of New Jersey
New Jersey’s decline of 5.5%, ranked 35th in the U.S. in GDP. New York showed the largest decline of all 50 states, contracting 8.2% due to the decline in its hospitality industry.

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