Real GDP growth rate by year in the U.S. 1990-2019

In 2019 the real gross domestic product (GDP) of the United States increased by 2.3 percent compared to 2018. This rate of annual growth is around the average for the 2010’s, although much lower than the rates of around three to five percent seen for much of the decade between 1995 and 2005. It is certain that 2020 will see a dramatic decline in the GDP growth rate due to the the coronavirus (COVID-19) pandemic. Initial quarterly projections of Real GDP suggest a fall by as much as 30 percent.

What does GDP growth mean?

Essentially, the annual GDP of the U.S. is the monetary value of all goods and services produced within the country over a given year. On the surface, an increase in GDP therefore means that more goods and services have been produced in one period than another. Things are not quite so simple though.

What is the difference between GDP and real GDP?

As GDP is calculated using the market value of goods and services during the period they were produced, it does not factor in regular price increases, as reflected by the U.S. inflation rate, can increase GDP without any corresponding increase in production. The annual real GDP or ‘constant price’ GDP is designed to get around this problem by ‘chaining’ price values to a particular year – in this case 2012 – so that only the underlying change in the production of goods and services is measured.

Countries with highest GDP growth rate

Although the United States has by far the largest GDP of any country, it does not have the highest real GDP growth rate of major world economies. This honor goes to China, who reported a real GDP growth rate of 1.5 percent in the fourth quarter of 2019, compared to 0.53 percent in the U.S. Russia and India also recorded higher growth rates than the United States, although the U.S. did achieve higher real GDP growth than the other major developed economies.