News

Issues and events that shape Long Island's economic and legislative landscape.

Sunday, December 21, 2014

Statement from LIA Chief Economist John Rizzo on Economic Growth up 2.8% third quarter of 2013

"The US economy grew at an annual rate of 2.8% in the third quarter of 2013, substantially above expectations of 2% growth.  This level exceeded 2nd quarter GDP growth of 2.5% and 1st quarter growth of 1.1%.  While this is encouraging news, the growth reflected businesses restocking their shelves, which could mean less growth going forward.  Moreover, consumer spending, which comprises about 70% of GDP, grew at just 1.5%, its slowest increase in more than three years.  And business spending on nonresidential equipment-- a key indicator of investment-- fell by 3.7%, just the second time it has fallen in more than four years.  Tepid growth in consumer spending and declining business spending, combined with the effects of the Federal Government shutdown, point to lower growth in the coming quarter.  The overall impression is that the economy continues to recover, but at a modest pace that does not appear to be accelerating."