Pandemic concerns change economic growth forecast
Business economists have tempered their 2021 growth expectations, cutting nearly a point off their annual GDP forecast since earlier this year, according to the NABE outlook survey released today.
Why it matters: This reflects increased concerns over the pandemic's impact on the economy, particularly due to the spread of Delta and other variants. Panelists said that a faster vaccine rollout could improve their outlooks.
By the numbers: NABE survey panelists project 5.7% real GDP growth for 2021, which is down from the 6.5% mark in May.
- Anything above 4.8% would still be the highest annual GDP increase since 1984.
- Panelists expect 2022 growth to be 4.2%, down from 4.4% in May.
- Labor market expectations remained unchanged from May, with two-thirds of panelists still expecting non-farm payrolls to return to pre-pandemic levels by the end of next year.
Sorry, pols: Only a small percentage of panelists felt that federal action or inaction on a large spending bill would have a significant impact on short-term growth, but most expect sharp inflation growth in 2021 and moderate inflation growth in 2022.