Biggest drop in US GDP since World War II

The coronavirus pandemic has hit the US economy hard, with a New York Times front page summing up the devastating toll.

The broadest measure of the economy – gross domestic product – shows the US is in free fall.

US GDP plunged by an annual rate of 32.9 per cent in the last quarter, government figures revealed yesterday.

That’s the worst drop since World War II.

The New York Times summed it up with a striking headline: “Virus wipes out five years of economic growth”.

The New York Times front page about massive drop in US GDP. Picture; Supplied

It comes as nearly 30 million American workers are set to lose (USD)$600 in enhanced weekly unemployment benefits.

The US Federal Pandemic Unemployment Compensation program has helped keep the US economy afloat during the outbreak. But it was due to end at midnight on Friday (US time).

Yesterday Congress was left in deadlock, unable to agree on a proposal to continue the scheme.

Senate Republicans had put forward a new stimulus package which would cut weekly payments down to $200 until a new plan could be implemented.

White House Chief of Staff Mark Meadows said the Democrats had rejected reasonable offers.

House Speaker Nancy Pelosi countered by slamming the Republicans for advancing a proposal that would have only extended the benefits for a week.

“We don’t have shared values, that’s the way it is,” she said.

It comes after the US economy lost about 22 million jobs in March and April.

The economy rebounded in May and June, with about 7 million jobs added.

Another 1.43 million Americans filed for unemployment benefits last week.

“This is something we have never seen before,” assistant chair of finance at the University of Notre Dame Jason Reed said.

“At first I felt it was like a natural disaster that had hit the entire country at the same time. Now it is evolving into something worse than that.”

There have been more than 4.5 million infections in the US and more than 150,000 deaths.

The country – the worst hit in the world – has reported more than 1000 coronavirus deaths for four days straight.

The US is expected to record another 230,000 deaths by November – up 11,000 from the previous forecast.