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New, third-quarter GDP numbers sign 2020 economic losses could half what expected, White House

The U.S. economy more than doubled the record set in 1950 during the third quarter

Updated: October 31, 2020 - 11:37am

A top White House economic adviser says the record third-quarter GDP numbers released Thursday show that early projections on the U.S. economy contracting 8% this year as a result of the coronavirus might be cut in half. 

"Consensus forecasts were for the U.S. economy to contract by 8% or more during the four quarters of 2020," Tyler Goodspeed, acting chairman of the Council of Economic Advisers, said Friday on "Just the News AM." "So, with yesterday's number, we learned that we have thus far pared those losses by more than half." 

The Commerce Department reported Thursday that Gross Domestic Product, the market value of all the final U.S. goods and services produced in a specific time period, for the quarter increased at an annualized rate of 33.1% — beating economists' expectations.

Still, Goodspeed told show host Carrie Sheffield that the U.S. will need a strong fourth-quarter to continue to minimize losses and keep the economy chugging along, during the pandemic. 

He projected a contraction as small as 2.5% if the economy continues to forge ahead during the pandemic.

"That would be a substantial mitigation of what was the worst macroeconomic shock to hit the U.S. economy, certainly in the post war period," Goodspeed said.

He also said the Trump administration is, above all, focused on the labor market and making sure that "businesses have the support that they need to safely reopen," in addition to ensuring that out-of-work Americans head back to work in order to "facilitate the most rapid possible labor market recovery."