Industry

The US economy's good condition in the second quarter of 2024 became possible over fast-growing consumer spending and a rebound in corporate profits. 

As shared by Reuters, the Commerce Department's Bureau of Economic Analysis reported the country's Gross Domestic Product, or GDP, at an annualized rate of 3.0%, which was initially 2.8%. This, compared to the first quarter's growth rate of 1.4%, points to continued economic expansion.

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Consumer Spending's Contribution to the US Economy

Consumer spending, which drives more than two-thirds of the U.S. economy, saw a significant upward revision. Voice of America noted that it increased at a 2.9% annualized rate, compared to the earlier reported 2.3% pace. Despite this growth, some areas of the economy, such as business investment, exports, and private inventory investment, experienced downgrades. 

Personal income gains also contributed to this spending, though they were revised down slightly to an increase of $233.6 billion in the second quarter.

Then, according to Bloomberg, corporate profits also saw a notable recovery, increasing by $57.6 billion after a $47.1 billion decline in the first quarter. Financial firms in the US recorded a $46.4 billion profit boost, while non-financial institutions saw profits rise by $29.2 billion. These gains helped offset an $18.0 billion decline in profits from international operations.

When combining GDP, which measures economic output, with GDI, which reflects income earned in the economy, the result is called gross domestic output, showing a 2.1% growth last quarter. This average provides a more comprehensive view of the economy's overall performance, indicating strong momentum despite signs of a slowing labor market.

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