Technical Note: COVID-19 Impact on the First-Quarter 2021 GDP Estimate
The increase in first quarter GDP reflected the continued economic recovery, reopening of establishments, and continued government response related to the COVID-19 pandemic. In the first quarter, government assistance payments, such as direct economic impact payments, expanded unemployment benefits, and Paycheck Protection Program loans, were distributed to households and businesses through the Coronavirus Response and Relief Supplemental Appropriations Act and the American Rescue Plan Act. The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the first quarter of 2021 because the impacts are generally embedded in source data and cannot be separately identified. For more information, see the Technical Note and Federal Recovery Program and BEA Statistics.
Real gross domestic product (GDP) increased at an annual rate of 6.4 percent in the first quarter of 2021, according to the "third" estimate released by the Bureau of Economic Analysis. In the fourth quarter, real GDP increased 4.3 percent. The increase in real GDP in the first quarter reflected increases in personal consumption expenditures (PCE), nonresidential fixed investment, federal government spending, residential fixed investment, and state and local government spending that were partly offset by decreases in private inventory investment and exports. Imports increased.
The increase in PCE reflected increases in durable goods (led by motor vehicles and parts), nondurable goods (led by food and beverages), and services (led by food services and accommodations). The increase in nonresidential fixed investment reflected increases in equipment (led by information processing equipment) and intellectual property products (led by software) . The increase in federal government spending primarily reflected an increase in payments made to banks for processing and administering the Paycheck Protection Program loan applications as well as purchases of COVID-19 vaccines for distribution to the public. The decrease in private inventory investment primarily reflected a decrease in retail trade inventories (mainly by motor vehicles and parts dealers).
In the third estimate, the change in first-quarter real GDP was the same as in the second estimate. Upward revisions to nonresidential fixed investment, private inventory investment, exports, and PCE were offset by an upward revision to imports.
COVID-19 Impact on the Third-Quarter 2020 GDP Estimate
The increase in third quarter GDP reflected continued efforts to reopen businesses and resume activities that were postponed or restricted due to COVID-19. The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the third quarter of 2020 because the impacts are generally embedded in source data and cannot be separately identified.
Real gross domestic product (GDP) increased at an annual rate of 33.4 percent in the third quarter of 2020, according to the "third" estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP decreased 31.4 percent.
The increase in real GDP reflected increases in PCE, private inventory investment, exports, nonresidential fixed investment, and residential fixed investment that were partly offset by decreases in federal government spending (reflecting fewer fees paid to administer the Paycheck Protection Program
loans) and state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased.