The value of all goods and services produced by the U.S. economy grew by 3.2 percent during the fourth quarter of 2010 – a modest increase that failed to meet analysts’ expectations and hinted at ongoing weaknesses in the labor market.
All told, the nation’s gross domestic product grew by 2.9 percent in 2010 after contracting by 2.6 percent in 2009, according to figures released Friday by the U.S. Department of Commerce.
Driving the fourth quarter growth, not surprisingly, was solid retail spending associated with the busiest holiday season in four years.
Still, the softness of the labor market is continuing to serve as a drag on the nation’s recovery – as record numbers of Americans have given up on their quest to find full-time employment.
The U.S. unemployment rate fell to 9.4 percent in December as the American economy created 103,000 jobs – although those numbers failed to match analysts’ expectations and much of the rate reduction was due to the fact that government no longer counts workers as “unemployed” when they give up looking for work.
Still, the report was much better than November’s dismal data, and unemployment now stands at its lowest level since May of 2009.
The U.S. economy created just 1.1 million jobs in 2010 – or roughly 94,000 per month. That’s nowhere near enough job growth to keep up with an expanding population – to say nothing of replacing the 8 million jobs that were lost during the recession.
Analysts estimate that the economy must create roughly 125,000 jobs each month simply to keep pace with population growth – which it obviously hasn’t been doing. As a result, unemployment has remained at 9.4 percent or higher for the past twenty months – well-above the levels U.S. President Barack Obama promised when touting his so-called “economic stimulus.”
In South Carolina, the unemployment rate currently stands at 10.7 percent. It has remained above 10.6 percent for the last twenty-three months.