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The economy just experienced its fastest three months of growth in U.S. history.
In the third quarter, from July to September, GDP climbed 33.1% on an annualized basis, according to data released Thursday by the U.S. Bureau of Economic Analysis.
This historic climb follows the U.S. record 31.4% annualized GDP decline in the second quarter, and the 5% annualized decline in the first quarter. During that period economists around the world were in panic and questioning if the United States—as well as the rest of the world—were on the cusp of an economic depression. But once states began to ease lockdown restrictions in the summer, the U.S. economy sprung from deep contraction to high growth.
It’s the last major piece of economic data before Election Day, and President Trump was quick to celebrate the numbers.
But we’re still in the hole. Over the course of the first two quarters, annualized U.S. GDP fell from $21.8 trillion to $19.5 trillion. In the third quarter that swung back up to about $21.2 trillion.
And the easy economic gains are over. When states reopened this summer, jobs at places of business without mass crowds, like dental offices and barber shops, returned quickly. In all, 11.4 million jobs have returned since May. But with the pandemic still raging across the nation, businesses like hotels and event venues are far from pre-pandemic employment levels. Indeed, the economy is still down 10.7 million jobs, including 3.8 million in leisure and hospitality.
“The fourth quarter numbers may tell a less robust story, exposing the tenuous nature of this recovery. The lagged effects of fiscal support provided through the CARES act are fading at a time when COVID cases are surging,” wrote Madhavi Bokil, vice president of Moody’s Investors Service, following the GDP release.
But while GDP is seeing something closer to a V-shaped recovery—bouncing back nearly as fast as it fell—that isn’t the case for U.S. employment. The U.S. added 661,000 jobs in September. If that pace were to continue, it would take over 16 months—into 2022—to recover all the jobs lost during the COVID-19 recession. The issue? That pace of hiring is expected to slow further, meaning a full employment recovery could take until 2023 or longer.
It’s often said that the stock market isn’t the economy. But it’s also true that the economy—or at least GDP—isn’t us.
More must-read finance coverage from Fortune:
- Chobani and PayPal are paying workers more—and rethinking capitalism
- When it comes to climate change, says Mark Carney, this financial crisis is different—and maybe better
- Ray Dalio on why Chinese capitalism is on the rise—and why American capitalism is in desperate need of a fix
- Microsoft’s cloud could be a bit foggy for the next quarter
- Coinbase launches crypto debit card in U.S. with 1% Bitcoin reward
