BEA has updated gross domestic product and related statistics covering the past five years, and in some cases reaching back decades, to reflect newly available source data; improved seasonal adjustment; innovations in measuring the prices of software, medical equipment, and cellphones; and more.
After today’s comprehensive update, the general picture of U.S. economic activity remains largely the same. From 2007-2017, real GDP is now estimated to have increased at an annual average rate of 1.5 percent; In our previously published estimates, GDP increased 1.4 percent.
Over the expansion period from the second quarter of 2009 through the fourth quarter of 2017, the estimate remains the same as previously reported, growing at an annual average rate of 2.2 percent.
Our updated statistics revise modestly the size of the economic contraction from the fourth quarter of 2007 to the second quarter of 2009. Real GDP decreased at an average annual rate of 2.7 percent; in the previously published estimates, it decreased 2.8 percent.
Updating previously published statistics is necessary to keep pace with an ever-changing economy while maintaining consistent long-term datasets. Annual GDP figures, for example, reach back to 1929.
This is BEA’s 15th comprehensive, or benchmark, update of the National Income and Product Accounts. These updates are typically performed every five years, based on the Census Bureau’s every-five-years economic censuses, source of the most comprehensive industry and commodity data available.
The same 2012 Economic Census data also will underlie BEA’s 2012 Benchmark Input-Output Accounts when they are released in November.
Other major improvements in this update:
- It completes our Three-Phase Seasonal Adjustment Improvement Plan begun in 2015. BEA has worked closely with the agencies that provide our source data to mitigate potential sources of “residual seasonality” – seasonal patterns that remain even after data have been adjusted to smooth out seasonal variations. Extensive testing found no signs of residual seasonality in our updated data.
- As part of the seasonal adjustment improvement plan, today we released estimates of GDP, gross domestic income, and their major components that have not been seasonally adjusted. Going forward, not seasonally adjusted estimates will be published at the same time as seasonally adjusted estimates, providing greater transparency and an additional tool for evaluating the economy.
- We’ve improved our measurement of the digital economy. We incorporated price indexes that better capture innovations and improved quality in software, medical equipment, and cellphones, to more accurately measure their contributions to growth and productivity. We also updated measurements of private investment related to cloud computing.
BEA’s reference year for its inflation adjustment and price measures is updated to 2012. The reference year normally moves forward five years during comprehensive updates, but this time it moves three years. That’s because the last comprehensive update was a special case. We used 2009 as the reference year, instead of 2007, to avoid setting the reference period during the start of the latest recession, which the National Bureau of Economic Research dated to December 2007.