Delaware Economy Slows to 1.4% Growth in Fourth Quarter

The U.S. economy expanded at a slower 1.4% pace during the final quarter of last year, according to new Commerce Department data. The deceleration was attributed to the federal government shutdown and reduced consumer spending patterns.

WASHINGTON — The American economy experienced a notable deceleration during the last three months of the previous year, with federal data showing growth hampered by a lengthy government shutdown and diminished household spending patterns.

According to Friday’s Commerce Department release, the country’s gross domestic product expanded at an annualized 1.4% clip during the October-December period. This represents a sharp decline from the robust 4.4% expansion recorded in the summer months and the 3.8% growth seen in the spring quarter.

Household expenditures managed only a 2.4% increase, marking a considerable retreat from the stronger 3.5% advancement witnessed during the July-September timeframe.

The data highlights a puzzling characteristic of America’s current economic landscape: steady expansion coupled with minimal job creation. While the economy posted a respectable 2.2% annual growth rate in 2025, recent employment figures revealed that businesses created fewer than 200,000 positions throughout the year — representing the weakest job growth since the pandemic’s onset in 2020.

Economic analysts identify multiple factors contributing to this disconnect. The current administration’s immigration enforcement policies have significantly curtailed population increases, limiting the pool of available workers. This dynamic helps explain why joblessness climbed modestly from 4% to 4.3% despite the virtual absence of new hiring.

Additionally, some enterprises may be postponing workforce expansion while evaluating whether artificial intelligence technologies could boost productivity without additional personnel. Trade barrier costs have also squeezed corporate profits, potentially prompting companies to restrict their recruitment efforts.

The current economic environment presents another contradiction: while growth remains stable, price pressures have eased somewhat, and joblessness stays contained, polling indicates Americans maintain a pessimistic outlook about economic conditions. Consumer confidence measurements dropped to their lowest point since 2014 in January, yet spending continues to drive economic expansion.

This purchasing activity may be concentrated among higher-earning households, creating what experts call a “K-shaped” recovery pattern. However, banking sector information suggests lower-income consumers are also increasing their expenditures, albeit at a more modest pace.