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Technical Note
Gross Domestic Product
Third Quarter of 2009 (Advance)
October 29, 2009
This technical note provides background information about the source data and
estimating methods used to produce the estimates presented in the GDP news
release. The complete set of estimates for the third quarter is available on BEA's
Web site at www.bea.gov; a brief summary of "highlights" is also posted on the
Web site. In a few weeks, the estimates will be published in BEA's monthly
journal, the Survey of Current Business, along with a more detailed analysis of
the estimates ("GDP and the Economy").
Real GDP
Real GDP increased 3.5 percent (annual rate) in the third quarter, following a
decrease of 0.7 percent in the second quarter. The upturn in real GDP in the
third quarter reflected upturns in consumer spending, inventory investment,
exports, and residential investment and a smaller decrease in business fixed
investment that were partly offset by an upturn in imports, a downturn in state
and local government spending, and a deceleration in federal government
spending.
Source Data for the Advance Estimate
The advance GDP estimate for the third quarter of 2009 is based on source data
that are incomplete and subject to revision. Three months of source data were
available for consumer spending on goods; shipments of capital equipment other
than aircraft; motor vehicle sales and inventories; manufacturing durables
inventories; federal government outlays; and consumer, producer, and
international prices. Only two months of data were available for most other key
data sources; BEA’s assumptions for the third month are shown in table A.
Among those assumptions are the following:
•
•
•
•
a decrease in nondurable manufacturing inventories,
a decrease in non-motor-vehicle merchant wholesale and retail
inventories,
an increase in exports of goods, excluding gold, and
an increase in imports of goods, excluding gold.
Prices
The price index for gross domestic purchases increased 1.6 percent in the third
quarter after increasing 0.5 percent in the second quarter. Excluding food and
energy prices, the price index for gross domestic purchases increased 0.5
percent in the third quarter, after increasing 0.8 percent in the second.
American Recovery and Reinvestment Act of 2009
BEA's national accounts include the effects of the federal outlays and tax cuts
included in the American Recovery and Reinvestment Act of 2009. Because
most of the outlays and tax reductions from ARRA during the last three quarters
were in the form of grants to state and local governments, tax reductions for
individual and business taxpayers, and one-time payments to retirees, their
effects on GDP show up indirectly through the effects on GDP components such
as consumer spending, residential investment, and state and local government
spending. Thus, BEA’s accounts do not directly identify the portion of GDP
expenditures that is funded by ARRA. During each of the second and third
quarters, the Making Work Pay Credit provision lowered personal taxes and
raised disposable personal income about $50 billion (annual rate). During the
second quarter, ARRA provided payments of $250 to beneficiaries of social
security and other programs that raised disposable personal income about $55
billion. ARRA also provided special government social benefits for
unemployment assistance, for student aid, and for nutritional assistance; these
special benefits raised disposable income about $49 billion in the third quarter
and about $35 billion in the second quarter. ARRA also funded current grants
(such as Medicaid) and capital grants (such as highway construction) to state
and local governments of about $75 billion in the third quarter and $85 billion in
the second quarter.
Brent R. Moulton
Associate Director for National Economic Accounts
Bureau of Economic Analysis
(202) 606-9606
Table A. KEY ASSUMPTIONS FOR THE ADVANCE ESTIMATE OF GDP
FOR THE THIRD QUARTER OF 2009
For many of the key series used to prepare the advance estimate of GDP, including retail sales,
unit automobile and truck sales and inventories, manufacturers' shipments of nondefense
capital goods (other than aircraft), manufacturers' inventories of durable goods, federal defense
spending, and consumer, producer, and international price indexes, actual data are available for all
months of the quarter.
For the key series shown in this table, actual data for the third month of the quarter usually are not
available in time for inclusion in the advance GDP estimate. BEA makes assumptions for the source
data that are not yet available; assumptions for September 2009 are shown in the last column of the
table. For most series shown, the data for August are preliminary and subject to further revision.
Occasionally, the data for earlier months are also subject to revision.
All series shown in the table are in billions of dollars, seasonally adjusted at annual rates, and are
published by the Bureau of the Census.
2009
Apr.
Private fixed investment:
Nonresidential structures:
1 Value of new nonresidential
construction put in place………..
May
Jun.
Jul.
Aug.
Sep.*
401.5
398.4
382.6
372.8
372.6
372.7
Equipment and software:
Manufacturers' shipments of
complete aircraft…………………..
38.5
35.8
36.0
32.5
33.8
45.6
Residential structures:
Value of new residential
construction put in place:
3
Single family………………………..
95.1
91.4
95.8
102.3
107.0
109.9
4
35.6
32.0
29.5
29.1
27.8
28.6
Change in private inventories:
5 Change in inventories for nondurable
manufacturing………………………..
-24.7
-2.4
-10.0
-9.8
5.0
-8.4
5a Change in inventories for merchant
wholesale and retail industries other
than motor vehicles and equipment…
-74.3
-76.6
-109.1
-83.4
-62.8
-72.3
Net exports:
Exports of goods:
6 U.S. exports of goods,
international-transactionsaccounts basis……………………
960.0
985.0
1008.6
1041.2
1041.6
1064.0
6a
949.3
970.7
996.6
1028.4
1026.4
1049.8
1439.1
1431.7
1468.6
1554.2
1544.5
1596.0
Excluding gold……………………..
1432.1
1425.9
1457.2
1544.1
1536.9
1586.9
8 Net exports of goods………………….
-479.1
-446.8
-460.0
-513.1
-502.9
-532.0
8a
-482.7
-454.3
-460.5
-515.7
-510.4
-537.1
291.7
291.5
296.5
293.7
292.3
293.0
2
7
Multifamily…………………………..
Excluding gold………………………
Imports of goods:
U.S. imports of goods,
international-transactionsaccounts basis...............…..…....
7a
Excluding gold……………………..
Government:
State and local:
Structures:
9
Value of new construction put
in place……………………………..
____________
*Assumption.