That signals a strong 2011, but that growth is not yet strong enough to spark a lot of new hiring.
There is still disagreement here about what to do to get more people back to work.
Consumer spending drove the economic upswing.
Americans bought more clothing, more appliances and more cars during the last quarter.
It was the most retail buying since 2006.
Ford CEO Alan Mulally is overjoyed at the late surge in 2010.
"This is great quarter for Ford and it's a fantastic year," he said. "This is the best year we've had since 1999."
Still, Ford stock fell Friday.
Analysts expected more growth.
The numbers on employment were even more disappointing.
There was no growth, and little is expected in the next year.
"You still end up with an unemployment rate, depending on how many people give up entirely, above 9 percent by the end of the year," says Mesirow Financial chief economist Diane Swonk.
President Obama says spending now on infrastructure and education will help create lasting jobs.
The President also maintains that his healthcare reforms will help reel in the deficit.
But Republicans, and many Democrats, argue the deficit should be fixed first, before any new spending initiatives are undertaken.