New government data indicates that the U.S. economy grew faster in the third quarter of this fiscal year than it has in the past two years, yet economists warn that the solid growth does not mean things are looking up in the future.
On Oct. 28, a Commerce Department growth report found the U.S. gross domestic product had grown by 2.9 percent between July and September 2016, outperforming previous forecasts of 2.6 percent, The Washington Post reports.
The promising report arrives after two quarters of disappointing growth. The U.S. GDP had not grown past 2.7 percent in the previous seven quarters.
“It’s a sigh of relief after just over barely 1 percent growth in the first half of the year,” said chief economist Stuart Hoffman of PNC.
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Economists noted that the growth in the third quarter was spurred by unique circumstances; the growth largely came from a surge in U.S. exports prompted by a bad harvest in South America and businesses restocking their inventories.
Economist Ben Herzon of Macroeconomic Advisers said the latest report should not be mistaken for “a sign of persistent strength.”
The GDP growth also fuels speculation that the Federal Reserve will raise interest rates in December, which could place new burdens on an economy still recovering from the 2008 Great Recession.
GOP presidential nominee Donald Trump has frequently criticized the slow, but steady, U.S. economic growth during his presidential campaign. In September, the business mogul proposed a goal of four percent growth during his potential administration, a target many economists have ridiculed as unrealistic.
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“No, pigs do not fly,” senior economist Robert Brusca of FAO Economics told CNN Money. “Donald Trump is dreaming.”
Brusca explained that unemployment is already low, making it difficult to grow the GDP through job creation. He also noted that Baby Boomers are on the cusp of mass retirement, and that evolving technologies have increasingly made manufacturing jobs obsolete.
Economists have recommended investments in national infrastructure, immigration reform and technology innovation can be as game changing as the Internet in the 1990s.
Ironically, positive job growth under the Obama administration has not dissuaded many voters from siding with Trump, who has been casting the last eight years as an economic disaster.
On Oct. 27, an American City Business Journals analysis found that the three states that have benefited the most in job growth since January 2009 were North Dakota, Utah and Texas, San Antonio Business Journal reports.
The majority of voters those states are projected to cast their ballots for Trump, despite enjoying a surge in economic growth under a Democratic administration.