Economic forecasters have been offering increasingly optimistic outlooks as the pace of vaccination accelerates in the U.S., indicating that the economy could be headed for its best performance in decades. Axios’s Felix Salmon and Mike Allen put it this way Friday: “America’s financial titans are coming to a consensus: We are on the early edge of the biggest economic boom since World War II, with the promise of years of growth after the privation of the pandemic.”
Goldman Sachs economists are calling for a staggering 8% growth rate for the U.S. in 2021, while analysts at the consulting firm RSM recently upgraded their forecast to 7.5%. JPMorgan CEO Jamie Dimon joined the party this week, saying in his annual shareholder letter that not only will the economy show impressive strength this year, but the growth spurt will have legs. “This boom could easily run into 2023 because all the spending could extend well into 2023,” he wrote.
Economic indicators are starting to back up the rosy forecasts, Bloomberg reported Friday. Some of the sectors hit hardest by the Covid-19 pandemic – including hotels, airlines and restaurants – are rebounding rapidly. The March jobs report showed more than 900,000 new jobs, and the Institute for Supply Management said factory activity is growing at the fastest pace in nearly 40 years.
Some real-time time data is even stronger, suggesting the improvements are accelerating. “High frequency alternative data have been rising sharply for about the last month, and they foreshadowed the strong readings that we have since gotten,” Jesse Edgerton, an economist at JPMorgan Chase, told Bloomberg. “The alternative data already point to another strong job gain for April.”
In an especially hopeful sign for the labor market, which is still millions of jobs below its pre-pandemic level, job openings hit a two-year high in February, according to the Labor Department, and all signs point to continued improvements. “Our data show that the recovery has continued and accelerated since then,” Jed Kolko, Indeed chief economist, told Bloomberg. “Job postings increased at an even faster rate in March than in February.”