The U.S. Bureau of Economic Analysis reported today that the U.S. economy grew at a compounded annual rate of 1.25% (rounded up to 1.3%) in the second quarter of 2012, down from 2% in Q1 2012.
This represents a downward revision of 0.25% from the initial estimate of 1.5%, which I reported on in late July.
A few months ago, I began tracking the progress of the current recovery against the 1980s recovery.
Since the second quarter of 2009 (the last quarter of GDP contraction), real GDP growth has averaged 2.2% over the last twelve quarters. By comparison, in the twelve quarters following the third quarter of 1982 (the last quarter of GDP contraction resulting from the early 1980s recession), real GDP growth averaged 5.6%, or more than double the current average:
Falling demand, rising inventory excesses, and declining labor force participation have all contributed to lackluster growth and continue to expose the U.S. economy to the risk of a “double-dip” recession.