The third quarter of 2021 brought steady economic activities and strong economic recovery in North America. Despite this strong economic recovery, many existing and new challenges developed. Pandemic-related supply chain disruptions, logistics backlogs, shortages within semiconductor products and new virus re-problems, labor market issues (shortages across service industry as well as skilled labor)- have contributed to slower growth in Q3 2021 than previously expected.
With the help of government support and targeted fiscal policies, the US economy is showing a strong comeback in 2021. Furthermore, it is on a positive trajectory to continue to grow in the next few years. There are many reasons for us to be optimistic about this trend. Our positive outlook is based on the reviews of key economic indicators, including GDP, unemployment, and inflation. In our previous forecasts, we discussed recovery trends for the post-pandemic period, and we called for a return of demand for most markets in 2021, especially during H2 2021.
During Q3 2021, we have witnessed a strong level of activities and a rebound for many industries. Despite the latest mandates and increasing mask regulations from local governments, business and public have adjusted quite well to these realities; service-oriented industries are gaining traction and that translates to an overall increase of economic activities across many industries.
We believe the current challenges and setbacks to the recovery are temporary. While the latest COVID variants spikes are expected to go down by end of the year, we also expect the logistics and supply chain challenges to improve significantly. While employment has significantly improved in the last few months, service-oriented industries are still experiencing significant labor shortages. The same challenges have also impacted manufacturing industries where factories can not find enough skilled workers to meet the current increased demand, which has been on the rise. PSR
Yosyf Sheremeta, PhD, is Director of Product Management and Customer Experience at Power Systems Research
