Full text of National Economic Trends : April 1997
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April 1997 îcTrends Long Expansions expansion appears to be somewhere in the middle in terms of length, there is no evidence to suggest that the 34-quarter expansion in the 1960s represents some kind of upper limit on how long an expansion can continue. It is also clear from the chart that the relative level o f output so far in the current expansion is far below the relative level of output at similar points in the two longest expansions. If it were the 1960s all over again, the economy would now be producing about 1.38 times its beginning-of-expansion output. This suggests that the current expansion may have a long way to go based on the possible peak in real GDP. The 1960s, however, were witness to an influx of women into the labor force and high levels of produc tivity growth— influences that have tapered off in the 1990s. In part because o f such trends, some economists think the growth rate of potential GDP has slowed over the postwar era, so that a long expansion today might produce slower growth, on average, than earlier expansions. — James Bullard This month, the current economic expansion enters its seventh year. That means that the U.S. economy has produced positive growth in the real value of goods and services more or less continuously since 1991. Some analysts have noted that the current expansion is mature by the standards o f postwar U.S. economic history, and that one might reasonably expect a recession in the not-too-distant future. Is this true? Can we safely say anything about expan sions based solely on the fact that they have been continuing for some length o f time? A look at the data suggests that the answer is— probably not. The chart gives us a way to compare economic expansions since 1960. The data are the real value of gross domestic product (GDP), quarterly, since 1960, measured as a chain-weighted quantity index and scaled so that beginning-of-expansion output is equal to one. The scaling means that we can interpret the middle- or end-of-expansion level of GDP as a multiple of the beginning-of-expansion level of GDP. The end of an E c o n o m ic E x p a n s io n s 1 9 6 0 -1 9 9 6 expansion is the last quarter 1.6 before the onset of a recession, 34 as defined by conventional 1.5 - ............................... A NBER dating. The next expansion then begins with 1.4 - ......................... - i r the level of output in the last 30 1.3 quarter of the recession. The 19 numbers indicate the length 1.2 o f the expansion expressed 23 in quarters. / / The chart shows that expan ‘ J sions sometimes take a long 1.0 time to unfold, and there have 0.9 not been enough of them to “i------1------1------1------1------1------1------1------1------1------1------1------1------1------1------1------1------1— 60 62 64 66 68 70 72 74 76 78 80 82 84 86 88 90 92 94 96 make any sturdy inferences T h e level o f real G D P is s ca led so th a t b e g in n in g -o f-e x p a n s io n o u tp u t is 1. T h e le n g th o f an about what the typical length e xp a n s io n Is g ive n in q u a rte rs in b o ld at th e e n d o f th e e xp a n s io n . might be. Although the current Views expressed do not necessarily reflect official positions of the Federal Reserve System Tabi eofCon ten ts Page 3 Economy at a glance 4 Output and growth 7 Interest rates 8 Inflation and prices 10 Labor markets 12 Consumer spending 14 Investment spending 16 Government revenues, spending, and debt 18 International trade 20 Productivity and profits 22 Quick reference tables 27 Notes and sources Conventions used in this publication: 1. Charts and tables contain data that was current on April 1, 1997. 2. Shaded areas indicate recessions, as determined by the National Bureau of Economic Research. 3. Percent change refers to simple percent changes. Percent change from year ago refers to the percent change from the same month or quarter in the previous year. The percent change at annual rate shows what the growth rate would be over an entire year if the same simple percent change continued for four quarters or twelve months. The percent change at annual rate of X between the previous quarter t-1 and the current quarter t is: For monthly data replace 4 with 12. 4. All data with significant seasonal patterns are seasonally adjusted, unless labeled NSA. National Economic Trends is published monthly by the Research Division of the Federal Reserve Bank of St. Louis. For more information on data, please call (314) 444-8573. Single-copy subscriptions are available free of charge by writing to the Public Affairs Office, Federal Reserve Bank of St. Louis, Post Office Box 442, St. Louis, MO 63166-0442 or by calling (314) 444-8808 or (314) 444-8809. Information in this publication is also included on the Federal Reserve Economic Data (FRED) electronic bulletin board at (314) 621-1824 or Internet World Wide Web server at http://www.stls.frb.org/fred. National EconomicTrends Consumer Price Index Real GDP Growth Percent change at annual rate Percent change 5 - ............................... 0.5 - .................... -11 .......................1........................1........................1................ 1993 1994 1995 1996 Industrial Production interest Rates Percent change Percent 1.8 - ................................................................... 1.2 — 0.6 - I 0.0 id . . I Ï Ï n Ü r ^ 0 6 1....................... 1........................1........................1....................... 1 1994 1995 1996 1997 2 1....................... 1....................... 1....................... 1............... 1994 1995 Change in Nonfarm Payrolls Unemployment Rate Thousands Percent of labor force 8 - .................................. 600 - 1996 1997 1996 1997 5004007— 300 200- 100 - id 0 -100 1994 1995 1996 1997 1994 1995 3 National EconomicTrends Real Gross Domestic Product Percent change from year ago 0 Industrial Production and Purchasing Managers’ (NAPMj Indexes Percent change from year ago 18 Index - 74 - 66 - 58 — 42 - 34 r 26 Aggregate Private Nonfarm Hours Percent change from year ago 12 8 Real Change in Business Inventories Percent of GDP National Economic Trends Real Final Sales and GDP Real GDP Revisions Percent change at annual rate 6 - ........................................... Percent change at annual rate 6 —i— Industrial Production and NAPM Index F’ercent change 1.8 - ........................................ Advance Preliminary Final Nominal Gross Domestic Product Index — Percent change at annual rate 68 8 50 2- - ....................................................................................... 1994 1995 1996 Aggregate Private Nonfarm Hours Forcent change 4- Hours 33.5 -j............ — ..............1............................... 1................... 1995 1996 1 1997 Real Change in Business Inventories Inventory-Sales Ratio Billions of 1992 dollars 80 - ....-....................... Manufacturing and trade 1.46 - ............... 5 Nat iona IEconomic Trends Contribution of Components to Real GDP Growth Percent change at annual rate 6 H------- 95Q1 95Q2 95Q4 95Q3 Consumption Imports I 96Q2 96Q1 Real GDP Government Exports i Inventories 96Q4 9603 V//A Investment Contributions to Real GDP Growth Rate 1995 1st 3rd 4th 1996 1st 2nd 3rd 4th Real GDP 0.43 0.75 3.80 0.25 2.00 4.67 2.10 3.82 Final Sales 0.55 2.11 3.56 1.35 3.04 4.15 0.47 4.89 -0.09 -1 .4 3 0.15 -1.08 -1.03 0.59 1.60 -0.98 0.65 2.11 1.65 0.71 2.36 2.28 0.34 2.28 Fixed Investment Nonresidential Residential 1.19 1.49 -0 .2 6 -0 .2 3 0.36 -0.56 0.85 0.515 0.34 0.51 0.26 0.24 1.47 1.19 0.28 1.05 0.41 0.61 1.54 1.80 -0.22 0.53 0.61 -0.07 Government Federal State and Local -0 .2 3 -0.4 9 0.26 0.15 -0 .1 0 0.25 -0.11 -0.41 0.31 -0.81 -0.96 0.17 0.30 0.40 -0.11 1.39 0.62 0.76 -0.12 -0 .2 4 0.13 -0.16 -0.37 0.22 Net Exports Exports Imports -1 .0 8 0.28 -1 .3 6 0.07 0.65 -0.58 1.19 1.18 0.00 0.99 1.19 -0.21 -1.12 0.21 -1.33 -0 .6 3 0.66 -1.28 -1.31 -0.10 -1.21 2.27 2.73 -0.45 Residual -0 .0 3 0.07 0.03 -0.06 0.04 -0.03 0.01 -0.15 Change in Inventory Consumption 6 2nd National Econom ic Frenc/s Interest Rates Percent 18 - ..... 10-Year Treasury 12 3 -Month Treasury Treasury Yield Curve Percent 4.5 4.0 - 3m iy 2y 5y 7y iOy 30y Total Return on Standard and Poor’s 500 Percent change from year ago 75 50 25 0 -2 5 -5 0 7 National EconomicTrends GDP Chain Price Index Percent change from year ago 12 - 1 Consumer Price Index Percent change from year ago Producer Price Index, Finished Goods Percent change from year ago Employment Cost Index and Compensation per Hour Percent change from year ago 8 90 I 91 I 92 l~ 93 I 94 1 95 I 96 1 National EconomicTrends Crude Oil Price GDP Chain Price Index Percent change at annual rate Dollars per barrel 4 - .....................................- ............ 28 - ........................... i l l l l l 1995 1994 l l l l 1996 121 1992 1 1993 1 1994 1 1995 1 1996 1 1997 ' Consumption Chain Price Index Consumer Price Index Percent change Percent change at annual rate 0.5 - ..................... 4 - .................................................................. Excl. Food & Energy 0.4 — CPI (bar) 0.3 - A 0.2 - 0.1 - J 0.0 u 1996 1995 1994 1997 Producer Price Index, Finished Goods Unit Labor Cost Percent change Percent change at annual rate 1995 1996 1995 1996 0.75 - 1995 1996 1997 Employment Cost Index Compensation per Hour Percent change from year ago 8Benefits 5 - ................................................... ' 1991 1 1992 ' 1993 ' 1994 ' 1995 ' 1996 Percent change at annual rate ' 1994 9 National EconomicTrends Employment Percent change from year ago Unemployment, Labor Force Participation and Employment Rates Percent of labor force Duration of Unemplopent Percent of labor force 4 .5 0 - Percent of population ..........................- 70 National Economic Trends Change in Nonfarm Payrolls Change in Manufacturing Payrolls Thousands Thousands 60 - .......... 600 - 40- 1995 1996 1997 Change In Household Employment Labor Force and Population Thousands Percent change from year ago -7 5 0 0.0 1995 1996 1997 I 1992 I 1993 I 1994 Unemployment Rate Help-Wanted Advertising Percent 6.0 - Index I 1995 I 1996 I 1997 Percent 4.5 - 40 1............ ............. r................ 1995 1996 1997 551 .............. 1.............. 1.............. 1..............I.............. I.............. r 1992 1993 1994 1995 1996 1997 45 11 N a tio n a l EconomicTrends Real Disposable Income Percent change from year ago, quarterly data 12 - - 4 1 ...... r...... i.......i'""'"'"'I 71 72 73 74 75 i.......i.......i.......i...... r fc...i...- t t .....i.......r...... i.......r...... i.......r.......i...~ T ......r “ r r ” ” i...... i.......r 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 Real Consumption Percent change from year ago Percent change from year ago 21 30- -*> i ...... i....... i..... i 71 72 73 74 i .......i.......i.......i.......i.......r ~ ...I 75 76 77 78 79 80 Retail Sales Percent change from year ago of quarterly average 16- V Debt Service as Percent of Disposable Income Percent 18 - 12 81 82 83 84 85 86 87 88 89 90 91 92 i...... i...... t.......i...... r ~ 14 93 94 95 96 National Economicirends Real Disposable Income Personal Saving Rate Percent change 2 - ---------------------------------Quarterly Percent 8 - ....... 1- I M f i ¡» I r ~ fl ii n il -1 -2 1995 1996 1997 Real Consumption Percent change Percent change 1.5 - ................................. 7.5 - .................... -> O •! 1995 1996 1997 Retail Sales Total Auto and Light Truck Sales Percent change Millions of vehicles, annual rate 2.25 - .................. 16 - ................................................................... 1.50 0.75 -! 0.00 11 l l l . l l . I l l l . I -0.75 — -1.50 T 1995 1996 1997 13 1 .................................. 1................................... t.................................. 1 1995 1996 ' 1997 Consumer Sentiment (U. of Michigan) Billions of dollars, not seasonally adjusted Index 250- 110 60 -r..................t..................t.................. t..................T................. t................. l 1992 1993 1994 1995 1996 1997 13 HationalEconomicTrends Real Investment Percent of GDP Real Private Fixed Investment Percent change from year ago 24 18- 12 60-6 -1 2 - -18 t Real Nonresidential and Producers Durable Equipment Investment Percent change from year ago Real Residential Investment Percent change from year ago 60 40 20 0 -2 0 -4 0 14 for FRASER Digitized HationaìEconomicTrends Gross Saving Rates and Net Foreign Investment Percent of GDP 22- F^ercent of GDP 8 ____ ' 71 72 73 74 V - ...................... ' « > __ _ ✓ .............................................................................. r................. 1........ i.........1.... “ T .......I........ i........ 1.........1........ 1........ r 75 76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 Real Private Fixed Investment Nondefense Capital Goods Orders Percent change at annual rate Percent change from year ago, excluding aircraft 30------------------------------------------------------------- 95 96 ~4 -1 0 ■20 -I.............. I......... ..... 1...........— T............... T...............T 1994 1995 1992 1996 1 1993 1994 1995 Real Equipment Investment Real Nonresidential Investment Percent change at annual rate Percent change at annual rate 20 - ..................................................... 25 - ............................................ -......... 1996 1997 15- 10- 1994 1995 1994 1996 Real Residential Investment Housing Starts Percent change at annual rate 20 - ...... - .....................— ......... .. 1.6 1994 1996 1995 1996 Millions, annual rate - ...................... - — .... 1996 15 National EconomicTrends Govt. Consumption and Investment Government Receipts and Outlays Billions of 1992 dollars 1400 Percent of GDP 1200 15 72 Federal Outlays, 1994 74 76 78 80 82 84 86 88 Federal Receipts, 1994 Defense 22.61% Personal Income 39.54% Social Other 7.94% Social Insurance 40.57% 5.31% State and Local Outlays, 1994 Education 37.66% State and Local Receipts, 1994 Personal Income 13.28% Corp. Profit 3.27% Income Medical Care 17.32% Other 9.69% 18.13% Transportation 6.80% 16 Social 7.36% Safety 10.44% Federal Grants 20.70% National Economic Trends Gross Federal Debt Federal Deficit Percent of GDP Percent of GDP 60 50 40 2 30 Change in Gross Federal Debt Federal Deficit, Unified Basis Billions of dollars, fiscal years Percent of GDP 300 6 150 4 0 2 -1 5 0 Government Budgets Billions of dollars National Income Accounts Calendar Years Federal State and Local Receipts Expenditures Fiscal Years Surplus or Delicit(-) Receipts Expenditures Federal Surplus or Defied) Receipts Outlays Surplus or Deficit)-) 1980 1981 1982 1983 1984 361.4 307.0 54.4 561.5 622.5 -61 .0 517.1 590.9 -7 3 .8 390.8 335.4 55.4 649.3 707.1 -5 7 .8 599.3 678.2 -7 9 .0 409.0 357.7 51.3 646.4 781.0 -1 3 4 .6 617.8 745.8 -1 2 8 .0 443.6 378.8 64.8 671.9 846.3 -1 7 4 .4 600.6 808.4 -207.8 492.0 405.1 86.9 746.9 902.9 -1 5 6 .0 666.5 851.8 -1 8 5 .4 1985 1986 1987 1988 1989 528.7 437.8 90.9 81 1.3 974.2 -1 6 2 . 9 734.1 946.4 -212.3 570.6 475.7 94.9 850.1 1027.6 -1 7 7 .5 769.1 990.3 -221.2 594.9 51 1.1 83.8 937.4 1066.3 -128.9 854.1 1003.9 -1 4 9 .8 631.4 545.5 85.9 997.2 1 118.5 -1 2 1 . 3 909.0 1064.1 -1 5 5 .2 681.0 585.9 95.1 1079.3 1 192.7 - 1 13.4 990.7 1 143.2 -152.5 1990 1991 1992 1993 1994 728.9 648.8 80.1 1 129.8 1284.5 -1 5 4 . 7 1031.3 1252.5 -221.2 784.2 708.4 75.8 1 149.0 1345.0 -1 9 6 . 0 1054.3 1323.6 -2 6 9 .4 844.3 758.0 86.3 1198.5 1479.4 -2 8 0 .9 1090.5 1380.9 -2 9 0 .4 897.1 802.2 94.9 1275.3 1530.9 -2 5 5 . 6 1 153.5 1408.7 946.4 846.6 99.8 1377.0 1567.3 -1 9 0 .3 1257.7 1460.8 -2 5 5 .1 -2 0 3 .1 996.1 901.1 95.0 1478.4 1640.1 -1 6 1 . 7 1351.5 1515.4 -1 6 3 .9 1044.0 951.0 93.0 1575.0 1702.1 -1 2 7 .1 1452.8 1560.1 -107.3 1995 1996 17 National Econom icirends Trade and Investment Income Balances Billions of dollars 10- - 4 0 ! .......... I 71 72 I 73 T- 74 r .........I.......... I .......... I..........I .......... 75 76 77 78 79 r 1 .... I .... — r ~ - i .......... r......... i .......... r..........i..........r......... .......... t....~ r ........ t .......... i 80 81 82 83 84 85 86 87 88 89 90 Exchange Rates 91 92 93 i ..........i.......... i .......... i 94 95 96 100 x (Deutsche mark/US$) YerVUSS - 450 Index, March 1973-100 160 140 - 300 120 - 225 100 - 150 80 Goods Import Shares, 1996 Goods Export Shares, 1996 AllOther 36.42% All Other 32.32% Mexico 9.28% Mexico Canada 21.85% Other OECD 14.26% Other OECD 9.64% Canada 19.58% 2.33% Japan 11.04% 18 Germany 3.84% France UK 2.36% 5.05% Germany 4.87% Japan 14.41% 3.61% National EconomicTrends Trade Balance Goods Trade Billions of dollars 0 Percent change from year ago 25 - ......................................... -5 - -1 0 - -1 5 ■20-, -5 1996 1996 1995 1997 Current Account Balance Services Trade Billions of dollars 0 Percent change from year ago 25 - ......................................... 1997 ...I 20 1994 1995 1996 Real GDP Growth of Major Trading Partners Percent change at annual rate United Kingdom 8- Germany 9 - l l . l - i -3 -| 1994 * l i 1995 1996 France 8— 20 — 19 National EconomicTrends Output per Hour and Manufacturing Capacity Utilization Percent change from year ago 15 Percent 90 9U Nonfarm Compensation per Hour Percent change from year ago 15 Output per Hour and Total Factor Productivity, Manufacturing Percent change, annual data 7.5 - 5.0 2.5 0.0 - 2 .5 - 5 .0 n 50 20 National EconomicTrends Nonfarm Output per Hour Manufacturing Output per Hour Percent change at annual rate Percent change at annual rate 6- 4 — ............................................ 2- —2 — -4 - -4 -6 T 1994 1995 1996 1994 1995 1996 Selected Component Shares of National Income Percent 1 3 - .........................« Percent ............................................... -srr . ................................................ — ............ tm*...................................................... - 75 73 Corporate Profits after Tax (with IVA and CCAdj) Percent change from year ago National EconomicTrends Nominal GDP 1992 1993 1994 1995 1996 1993 1994 FInal Sales Real GDP Percent chance Annual Year Billions rate ago of $ Billions Of 1992 $ Percent chanae Year Annual ago rate Billions of 1992 $ Percent chanae Annua Year rate ago Change in Business Inventories Billions of 1992 $ Last qtr Year/Year ago 6244.4 5.5 6244.442 2.7 6237.441 2.5 6553.0 4.9 6386.378 2.3 6365.496 2.1 7.268 6935.7 5.8 6608.680 3.5 6550.685 2.9 19.073 -2 .9 7 9 725 3.8 4.6 6742.936 2.0 6708.867 2.4 58.900 7576.1 4.4 6907.211 2.4 6892.123 2.7 33.128 1 6442.6 3.8 5.2 6326.432 -0 .1 2.4 6307.113 -0 .9 2.1 18.500 2 3 4 6506.2 4.0 4.9 6356.530 1.9 2.3 6334.496 1.7 2.1 20.846 1 1.294 6574.4 4.3 4.8 6393.434 2.3 2.1 6371.296 2.3 1.9 19.540 12.142 6688.6 7.1 4.8 6469.055 4.8 2.2 6449.202 5.0 2.0 17.414 5.782 6776.0 5.3 5.2 6508.519 2.5 2.9 6467.727 1.2 2.5 40.530 18.500 6890.5 6.9 5.9 6587.574 4.9 3.6 6514.945 3.0 2.8 74.481 20.846 1 -0.142 2 3 4 6993.1 6.1 6.4 6644.898 3.5 3.9 6582.060 4.2 3.3 64.488 19.540 7083.2 5.3 5.9 6693.854 3.0 3.5 6638.134 3.5 2.9 56.093 17.414 1 7149.8 3.8 5.5 6701.036 0.4 3.0 6647.366 0.6 2.8 54.510 40.530 2 3 4 7204.9 3.1 4.6 6713.524 0.7 1.9 6682.420 2.1 2.6 30.450 74.481 7309.8 6.0 4.5 6776.406 3.8 2.0 6741.364 3.6 2.4 32.976 64.488 7350.6 2.3 3.8 6780.715 0.3 1.3 6764.193 1.4 1.9 14.584 56.093 1996 1 2 3 4 7426.8 4.2 3.9 6814.310 2.0 1.7 6815.153 3.0 2.5 -2 .9 9 9 54.510 7545.1 6.5 4.7 6892.553 4.7 2.7 6884.700 4.1 3.0 7.064 30.450 7616.3 3.8 4.2 6928.396 2.1 2.2 6892.747 0.5 2.2 34.450 32.976 7716.1 5.3 5.0 6993.588 3.8 3.1 6975.892 4.9 3.1 17.341 14.584 1995 Consumption 1992 1993 1994 1995 1996 1993 1 2 3 4 1994 1 2 3 4 Durables Consumption Billions of 1992 $ Percent chanae Annual Year rate ago Billions of 1992 $ 4 2 19.796 2.8 4 3 39.512 2.8 4 4 73 .1 53 3.1 4 5 77.846 2.3 4690.6 7 2 2.5 611.390 Private Fixed Investment Percent chanae Annual Year rate ago 488.530 524.075 561.971 579.826 5.4 Nonresidentiai Investment Billions of 1992 $ Percent chanae Annual Year rate ago Billions of 1992 $ 5.8 783.427 5.7 557.869 1.9 7.3 836.355 6.8 593.645 6.4 7.2 921.083 10.1 652.054 9.8 3.2 975.923 6.0 714.307 9.5 1042.117 6.8 766.837 7.4 Percent chanae Annua Year rate ago 4289.6 7 6 0.7 2.8 506.010 0.8 6.3 815.422 4.9 7.5 577.495 6.0 6.1 431 8 .83 5 2.7 2.9 519.581 11.2 8.0 821.102 2.8 5.0 586.371 6.3 5.2 4359.471 3.8 3.1 528.863 7.3 7.5 835.407 7.2 6.1 593.137 4.7 5.8 439 0 .02 3 2.8 2.5 541.853 10.2 7.3 873.482 19.5 8.4 617.578 17.5 8.5 8.8 442 0 .53 2 2.8 3.1 549.591 5.8 8.6 892.417 9.0 9.4 628.545 7.3 4458.721 3.5 3.2 555.429 4.3 6.9 91 1.431 8.8 1 1.0 639.480 7.1 9.1 448 9 .35 7 2.8 3.0 563.089 5.6 6.5 930.813 8.8 1 1.4 660.472 13.8 11.4 4523 .9 59 3.1 3.1 579.768 12.4 7.0 949.686 8.4 8.7 679.713 12.2 10.1 1995 1 2 3 4 453 4 .76 2 1.0 2.6 566.490 -8 .9 3.1 969.499 8.6 8.6 704.449 15.4 12.1 456 9 .87 0 3.1 2.5 576.187 7.0 3.7 965.676 -1 .6 6.0 710.480 3.5 1 1.1 4597.341 2.4 2.4 589.089 9.3 4.6 979.973 6.1 5.3 718.954 4.9 8.9 460 9 .41 0 1.1 1.9 587.540 -1 .0 1.3 988.536 3.5 4.1 723.339 2.5 6.4 1996 1 2 3 4 464 9 .07 6 3.5 2.5 599.202 8.2 5.8 1013.292 10.4 4.5 743.478 11.6 5.5 468 7 .60 3 3.4 2.6 615.621 11.4 6.8 1031.100 7.2 6.8 750.512 3.8 5.6 469 3 .46 8 0.5 2.1 611.605 -2 .6 3.8 1057.485 10.6 7.9 781.374 17.5 8.7 4732 .5 43 3.4 2.7 619.134 5.0 5.4 1066.589 3.5 7.9 791.984 5.5 9.5 22 tiationalEconomicTrends Employment Cost Index GDP Chain Price Index Index 1992 1993 1994 1995 1996 1993 1 2 3 4 1994 1 2 3 4 1995 1 2 3 4 1996 1 2 3 4 Percent chanae Annual Year rate ago Index 1993 1 2 3 4 1994 1 2 r3 4 1995 1 2 3 4 1996 1 2 3 4 ECI: Benefits ECI: Wages Index Percent change Annual Year rate ago Index Percent change Annual Year rate ago 100.000 2.8 114.3 3.7 1 1 1.9 2.9 120.5 5.6 102.616 2.6 118.4 3.6 115.2 2.9 127.0 5.4 104.958 2.3 122.2 3.2 1 18.5 2.9 132.1 4.0 107.565 2.5 125.7 2.8 121.9 2.9 135.0 2.2 109.875 2.1 129.2 2.8 126.0 3.3 137.4 1.8 101.832 3.8 2.7 116.9 4.2 3.5 113.9 3.2 2.6 124.8 6.7 5.5 102.386 2.2 2.6 117.9 3.5 3.7 114.6 2.5 2.7 126.5 5.6 5.9 102.833 1.8 2.7 118.9 3.4 3.7 115.6 3.5 3.1 127.7 3.8 5.3 103.415 2.3 2.5 119.9 3.4 3.6 116.5 3.2 3.1 128.9 3.8 5.0 104.149 2.9 2.3 120.8 3.0 3.3 1 17.2 2.4 2.9 130.3 4.4 4.4 104.632 1.9 2.2 121.8 3.4 3.3 1 18.1 3.1 3.1 131.5 3.7 4.0 105.248 2.4 2.3 122.8 3.3 3.3 1 19.0 3.1 2.9 132.9 4.3 4.1 105.802 2.1 2.3 123.5 2.3 3.0 119.7 2.4 2.7 133.6 2.1 3.6 106.676 3.3 2.4 124.4 2.9 3.0 120.6 3.0 2.9 133.8 0.6 2.7 107.309 2.4 2.6 125.3 2.9 2.9 121.5 3.0 2.9 134.6 2.4 2.4 107.855 2.1 2.5 126.1 2.6 2.7 122.4 3.0 2.9 135.4 2.4 1.9 108.419 2.1 2.5 126.9 2.6 2.8 123.2 2.6 2.9 136.1 2.1 1.9 109.027 2.3 2.2 127.8 2.9 2.7 124.5 4.3 3.2 136.0 -0 .3 1.6 109.619 2.2 2.2 128.8 3.2 2.8 125.6 3.6 3.4 136.9 2.7 1.7 1 10.166 2.0 2.1 129.6 2.5 2.8 126.4 2.6 3.3 137.8 2.7 1.8 1 10.689 1.9 2.1 130.6 3.1 2.9 127.3 2.9 3.3 138.8 2.9 2.0 Nonfarm Output per Hour Imports Exports 1992 1993 1994 1995 1996 Percent change Annual Year rate ago Nonfarm Compensation/Hr Billions of 1992 $ Percent change Annual Year rate ago Index 6.6 668.959 7.5 100.0 3.2 100.0 5.2 9.2 102.3 2.3 Billions of 1992 $ Percent change Annual Year rate ago 639.416 Percent change Annual Year rate ago Index Percent change Annual Year rate ago 658.215 2.9 730.249 100.2 0.2 71 1.971 8.2 817.635 12.0 100.7 0.5 104.3 2.0 775.401 8.9 882.999 8.0 100.9 0.2 107.7 3.3 825.898 6.5 939.530 6.4 101.6 0.7 1 1 1.6 3.6 647.083 -1 .3 2.2 703.069 8.3 8.5 100.1 -3 .9 0.8 101.5 1.2 2.9 660.044 8.3 3.8 724.429 12.7 8.4 99.7 -1 .6 -0 .2 102.0 2.0 2.4 645.484 -8 .5 0.9 731.707 4.1 9.1 100.1 1.6 0.4 102.5 2.0 1.8 680.255 23.4 4.8 761.777 17.5 10.5 100.8 2.8 -0 .3 103.0 2.0 1.8 677.647 -1 .5 4.7 776.962 8.2 10.5 100.3 -2 .0 0.2 103.8 3.1 2.3 703.108 15.9 6.5 810.404 18.4 11.9 100.6 1.2 0.9 104.1 1.2 2.1 719.560 9.7 1 1.5 831.262 10.7 13.6 101.0 1.6 0.9 104.5 1.5 2.0 747.573 16.5 9.9 851.919 10.3 11.8 101.1 0.4 0.3 105.4 3.5 2.3 752.330 2.6 1 1.0 874.851 11.2 12.6 100.5 -2 .4 0.2 106.2 3.1 2.3 763.226 5.9 8.6 884.605 4.5 9.2 100.9 1.6 0.3 107.2 3.8 3.0 782.952 10.7 8.8 884.524 -0 .0 6.4 101.3 1.6 0.3 108.2 3.8 3.5 0.0 109.3 4.1 3.7 3.8 803.087 10.7 7.4 888.023 1.6 4.2 101.1 -0 .8 806.713 1.8 7.2 910.707 10.6 4.1 101.5 1.6 1.0 1 10.2 3.3 817.864 5.6 7.2 932.556 9.9 5.4 101.7 4.1 3.8 -0 .9 4.2 953.541 9.3 7.8 101.7 0.8 0.4 1 1 1.3 816.106 0.8 0.0 1 12.2 3.3 3.7 862.91 1 25.0 7.4 961.314 3.3 8.3 102.0 1.2 0.9 1 13.2 3.6 3.6 23 National EconomicTrends Household Survey Employment Thousands Change 1992 1993 1994 1995 1996 118488 120259 123067 124899 126705 2808 1833 1806 1994 1 2 3 4 122035 122648 123178 124405 883 614 530 1227 1995 1 2 3 4 124924 124711 124820 125142 1 2 3 4 Nonfarm Payroll Employment Percent chanoe Annual Year rate ago 775 1771 Nonfarm Aggregate Hours Percent change Annual Year ago rate Thousands Change Index Percent chanoe Monthly Annual Yaar rate rate ago 0.3 2.0 3.1 2.7 2.0 121.2 124.6 129.9 133.4 136.4 0.7 2.8 4.2 2.7 2.2 0.7 1.5 2.3 1.5 1.4 108592 110726 114153 117202 119549 331 2134 3427 3050 2347 2.9 2.0 1.7 4.0 2.3 2.2 2.1 2.7 112625 113686 114690 115611 792 1062 1003 921 2.9 3.8 3.6 3.3 2.7 3.0 3.3 3.4 127.6 129.4 130.5 132.1 1.1 1.4 0.8 1.3 4.3 5.9 3.2 5.1 4.0 4.2 4.1 4.6 519 -213 109 322 1.7 -0 .7 0.4 1.0 2.4 1.7 1.3 0.6 116484 116956 117441 117928 874 472 485 487 3.1 1.6 1.7 1.7 3.4 2.9 2.4 2.0 132.9 132.9 133.6 134.3 0.6 0.0 0.5 0.5 2.4 0.1 2.1 2.0 4.2 2.7 2.4 1.7 125693 126381 127042 127705 551 688 661 664 1.8 2.2 2.1 2.1 0.6 1.3 1.8 2.0 118466 119264 119958 120509 538 797 694 551 1.8 2.7 2.3 1.8 1.7 2.0 2.1 2.2 134.2 136.1 137.0 138.2 - 0 .0 1.4 0.7 0.9 - 0 .2 5.6 2.8 3.5 1.0 2.4 2.5 2.9 1995 Feb Mar 124937 125070 171 133 1.7 1.3 2.3 2.5 116502 116701 252 199 2.6 2.1 3.5 3.3 132.7 132.8 -0 .4 0.1 -4.4 0.9 4.7 3.3 Apr May Jun 125023 124577 124533 -47 -4 4 6 -4 4 - 0 .5 -4 . 2 -0 .4 2.2 1.3 1.5 116861 116907 117100 160 46 193 1.7 0.5 2.0 3.1 2.8 2.7 133.7 131.9 133.2 0.7 -1 .3 1.0 8.4 -1 5 .0 12.5 3.8 1.7 2.6 Jul Aug Sep 124804 124729 124927 271 -7 5 198 2.6 - 0 .7 1.9 1.7 1.2 1.1 117201 117499 117623 101 298 124 1.0 3.1 1.3 2.5 2.4 2.3 133.5 133.4 134.0 0.2 -0.1 0.4 2.7 -0 .9 5.5 2.6 2.4 2.3 Oct Nov Dec 125235 125124 125068 308 -11 1 -5 6 3.0 -1.1 - 0 .5 1.0 0.5 0.3 117749 117899 118136 126 150 237 1.3 1.5 2.4 2.2 1.9 1.9 134.3 134.3 134.3 0.2 0.0 0.0 2.7 0.0 0.0 1.7 1.9 1.4 1996 Jan Feb Mar 125311 125706 126062 243 395 356 2.4 3.8 3.5 0.4 0.6 0.8 118070 118579 118750 -66 509 1.6 1.8 131.7 135.5 1.8 135.5 -1 .9 2.9 0.0 -20 .9 40.7 171 - 0 .7 5.3 1.7 0.0 -1.1 2.1 2.0 Apr May Jun 126125 126428 126590 63 303 162 0.6 2.9 1.5 0.9 1.5 1.7 118922 119332 119537 172 410 205 1.8 1.8 4.2 2.1 2.1 2.1 135.2 135.3 137.7 -0.2 0.1 1.8 -2.6 0.9 23.5 1.1 2.6 3.4 Jul Aug Sep 126889 126988 127248 299 99 260 2.9 0.9 2.5 1.7 1.8 1.9 119772 120052 120050 235 280 -2 2.4 2.8 -0 .0 2.2 2.2 2.1 136.1 136.9 138.0 -1.2 0.6 0.8 -13.1 7.3 10.1 1.9 2.6 3.0 Oct Nov Dec 127617 127644 127855 369 27 211 3.5 0.3 2.0 1.9 2.0 2.2 120311 120492 120723 261 181 231 2.6 1.8 2.3 2.2 2.2 2.2 137.1 138.2 139.3 -0.7 0.8 0.8 -7.6 10.1 10.0 2.1 2.9 3.7 1997 Jan Feb 128580 128430 725 -1 5 0 7.0 -1 .4 2.6 2.2 120970 121309 247 339 2.5 3.4 2.5 2.3 137.1 140.8 -1.6 2.7 -1 7 .4 37.7 4.1 3.9 1996 24for FRASER Digitized National EconomicTrends Retail Sales Unempl. Rate 1995 1996 1997 Billions of dollars 1992 1993 1994 1995 1996 7.5 6.9 6.1 5.6 5.4 1944.605 2072.550 2227.763 2342.801 2458.841 1 2 3 4 5.5 5.6 5.7 5.6 576.706 582.972 589.293 593.830 0.7 1.1 1.1 0.8 1 2 3 4 5.6 5.4 5.3 5.3 606.200 614.066 2.1 1.3 0.2 1.2 615.445 623.130 Industrial Production Percent chanae Year Monthly Annual ago rate rate 4.8 6.6 7.5 Index Percent chanae Monthly Annual Year rate rate ago 100.000 103.366 Treasury Yields 3 -m o 10-yr 3.2 3.4 5.0 3.3 2.8 3.43 3.00 4.25 5.49 5.01 7.01 5.86 7.08 6.58 6.44 5.74 5.60 5.37 5.26 7.48 6.62 6.32 5.89 4.93 5.02 5.10 4.98 5.91 6.72 6.78 6.34 5.06 6.56 5.2 5.0 108.558 112.109 1 15.201 2.7 4.4 4.4 3.1 6.1 5.8 5.1 3.7 111.764 1 1 1.561 1 12.441 1 12.671 1.0 -0 .2 0.8 0.2 3.9 - 0 .7 3.2 0.8 5.1 3.3 3.0 1.8 8.6 5.3 0.9 5.1 5.1 5.3 4.4 4.9 1 13.128 1 14.844 1 15.774 1 17.058 0.4 1.5 0.8 1.1 1.6 6.2 3.3 4.5 1.2 2.9 3.0 3.9 1 1995 Mar 5.4 192.574 0.8 10.1 4.6 1 1 1.720 0.1 0.8 4.4 5.73 7.20 Apr May Jun 5.7 5.6 5.6 192.372 194.493 196.107 -0.1 1.1 0.8 - 1 .3 14.1 10.4 4.9 6.3 6.2 1 1 1.421 1 1 1.523 1 11.739 -0 .3 0.1 0.2 -3.2 1.1 2.3 3.7 3.2 2.9 5.65 5.67 5.47 7.06 6.63 6.17 Jul Aug Sep 5.7 5.7 5.7 195.615 197.081 196.597 - 0 .3 0.7 -0 .2 -3 .0 9.4 -2 .9 5.9 5.2 4.4 1 11.716 1 12.603 1 13.003 -0 .0 0.8 0.4 -0 .2 10.0 4.3 2.4 3.1 3.4 5.42 5.40 5.28 6.28 6.49 6.20 Oct Nov Dec 5.5 5.6 5.6 196.225 198.159 199.446 -0 .2 1.0 0.6 - 2 .2 12.5 8.1 2.8 3.8 4.4 1 12.522 1 12.704 1 12.788 - 0 .4 0.2 0.1 - 5 .0 2.0 0.9 2.3 1.9 1.1 5.28 5.36 5.14 6.04 5.93 5.71 1996 Jan Feb Mar 5.7 5.5 5.5 199.132 202.840 204.228 -0 .2 1.9 0.7 -1 .9 24.8 8.5 3.1 6.2 6.1 112.361 1 13.782 1 13.241 -0 .4 1.3 -0 .5 -4 .4 16.3 -5 . 6 0.4 1.9 1.4 5.00 4.83 4.96 5.65 5.81 6.27 Apr May Jun 5.5 5.5 5.3 204.031 205.669 204.366 -0.1 0.8 - 0 .6 - 1 .2 10.1 - 7 .3 6.1 5.7 4.2 1 14.284 1 14.782 1 15.466 0.9 0.4 0.6 1 1.6 5.4 7.4 2.6 2.9 3.3 4.95 5.02 5.09 6.51 6.74 6.91 Jul Aug Sep 5.4 5.2 5.2 204.719 204.599 206.127 0.2 -0.1 0.7 2.1 - 0 .7 9.3 4.7 3.8 4.8 1 15.495 115.848 1 15.978 0.0 0.3 0.1 0.3 3.7 1.4 3.4 2.9 2.6 5.15 5.05 5.09 6.87 6.64 6.83 Oct Nov Dec 5.2 207.487 207.324 208.319 0.7 5.3 5.3 -0.1 0.5 8.2 -0 .9 5.9 5.7 4.6 4.4 1 16.231 1 17.216 1 17.728 0.2 0.8 0.4 2.6 10.7 5.4 3.3 4.0 4.4 4.99 5.03 4.91 6.53 6.20 6.30 5.4 5.3 21 1.456 213.175 1.5 0.8 19.6 10.2 6.2 5.1 1 17.565 1 18.130 -0.1 0.5 -1 . 6 5.9 4.6 3.8 5.03 5.01 5.14 6.58 6.42 6.69 1997 Jan Feb Mar 25 National EconomicTrends rroaucer rrice maex Finished Goods consumer rrice ¡nuex Consumer Price Index Index less Food and Energy Percent chanoe Monthly Annual Year rate rate ago Year to date Percent chanoe Monthly Annual Year ago rate Index rate Year to date Index Percent chanoe Monthly Annual Year rate rate ago 123.2 124.7 125.6 127.9 131.3 1.2 1.2 0.7 1.9 2.6 1992 1993 1994 1995 1996 140.4 144.6 148.3 152.5 157.0 1994 1 2 3 4 146.8 147.6 149.0 149.9 0.5 0.6 0.9 0.6 2.0 2.4 3.8 2.5 2.5 2.4 2.9 2.7 2.0 2.2 2.7 2.7 155.0 156.2 157.3 158.3 0.6 0.8 0.7 0.6 2.6 3.1 2.8 2.6 2.9 2.8 2.9 2.8 2.6 2.9 2.9 2.8 124.9 125.1 126.0 126.2 0.4 0.1 0.7 0.1 1.6 0.5 2.9 0.5 0.2 --0.2 1.3 1.4 1995 1 2 3 4 151.0 152.1 152.9 153.9 0.7 0.8 0.5 0.6 2.8 3.1 2.1 2.5 2.9 3.0 2.6 2.6 2.8 3.0 2.7 2.6 159.6 161.0 162.0 163.1 0.8 0.8 0.6 0.7 3.3 3.4 2.6 2.8 3.0 3.0 3.0 3.0 3.3 3.4 3.1 3.0 127.1 127.6 128.0 129.0 0.7 0.4 0.3 0.7 3.0 1.7 1.3 2.9 1.7 2.0 1.6 2.2 1 2 3 155.1 156.4 3.3 3.4 2.7 3.3 2.8 2.8 3.0 3.2 3.3 3.4 3.1 3.2 164.2 165.3 166.3 167.4 0.7 0.6 0.6 0.6 2.6 2.6 2.5 2.6 2.9 2.7 2.7 2.6 2.6 2.6 2.6 2.6 129.9 130.9 131.6 132.8 0.7 0.7 0.6 0.9 3.0 2.9 2.3 3.8 2.2 2.5 2.8 3.0 1996 3.0 3.0 2.6 2.8 2.9 3.7 3.3 2.8 3.0 2.7 147.5 152.4 156.7 161.4 165.8 4 157.5 158.8 0.8 0.8 0.7 0.8 1995 Feb Mar 151.0 151.3 0.3 0.2 3.2 2.4 2.9 2.9 2.8 2.7 159.6 160.1 0.3 0.3 3.1 3.8 3.0 3.0 3.8 3.8 127.1 127.3 0.2 0.2 1.9 1.9 1.7 1.8 Apr May Jun 151.8 152.1 152.5 0.3 0.2 0.3 4.0 2.4 3.2 3.1 3.0 3.0 3.0 2.9 2.9 160.6 161.0 161.3 0.3 0.2 0.2 3.8 3.0 2.3 3.1 3.1 2.9 3.8 3.7 3.4 127.5 127.7 127.7 0.2 0.2 0.0 1.9 1.9 0.0 1.9 2.2 2.0 Jul Aug Sep 152.6 153.0 153.2 0.1 0.3 0.1 0.8 3.2 1.6 2.8 2.6 2.5 2.6 2.7 2.6 161.6 162.0 162.4 0.2 0.2 0.2 2.3 3.0 3.0 3.0 2.9 3.0 3.3 3.2 3.2 127.9 127.9 128.3 0.2 0.0 0.3 1.9 0.0 3.8 1.8 1.3 Oct Nov Dec 153.7 153.8 154.1 0.3 0.1 0.2 4.0 0.8 2.4 2.7 2.6 2.5 2.7 2.5 2.5 162.9 163.1 163.4 0.3 0.1 0.2 3.8 1.5 2.2 3.1 3.0 3.0 3.3 3.1 3.0 128.5 128.8 129.6 0.2 0.2 0.6 1.9 2.8 7.7 2.4 2.1 2.2 1996 Jan Feb Mar 154.7 155.1 155.6 0.4 0.3 0.3 4.8 3.1 3.9 2.7 2.7 2.8 4.8 4.0 4.0 163.8 164.2 164.6 0.2 0.2 0.2 3.0 3.0 3.0 2.9 2.9 2.8 3.0 3.0 3.0 129.7 129.7 130.4 0.1 0.0 0.5 0.9 0.0 6.7 2.2 2.0 2.4 Apr May Jun 156.1 156.5 156.7 0.3 0.3 0.1 3.9 3.1 3.9 3.8 3.4 164.9 165.3 165.6 0.2 0.2 0.2 2.2 3.0 2.2 2.7 2.7 2.7 2.8 2.8 2.7 130.6 130.8 1.5 2.8 2.9 2.8 131.2 0.2 0.2 0.3 1.9 1.9 3.7 2.4 2.4 2.7 Jul Aug Sep 157.1 157.4 157.9 0.3 0.2 0.3 3.1 2.3 3.9 2.9 2.9 3.1 3.4 3.2 3.3 166.0 166.2 166.7 0.2 0.1 0.3 2.9 1.5 3.7 2.7 2.6 2.6 2.7 2.6 2.7 131.2 131.6 132.0 0.0 0.3 0.3 0.0 3.7 3.7 2.6 2.9 2.9 Oct Nov Dec 158.3 158.8 159.2 0.3 0.3 0.3 3.1 3.9 3.1 3.0 3.3 3.3 3.3 3.3 3.3 167.0 167.4 167.7 0.2 0.2 0.2 2.2 2.9 2.2 2.5 2.6 2.6 2.6 2.7 2.6 132.5 132.6 133.4 0.4 0.1 0.6 4.6 0.9 7.5 3.1 3.0 2.9 1997 Jan Feb 159.4 159.8 0.1 0.3 1.5 3.1 3.0 3.0 1.5 2.3 167.9 168.3 0.1 0.2 1.4 2.9 2.5 2.5 1.4 2.2 133.0 132.5 -0.3 -0 .4 -3 .5 -4.4 2.5 2.2 26 1.8 National EconomicTrends Notes Pages 4, 5: Final sales is gross domestic product (GDP) minus change in business inventories. Advance, preliminary, and final GDP growth rates are released during the first, second, and third months of the following quarter. Changes result from incorporation of more com plete information. The Purchasing Managers’ Index is a weighted average of diffusion indexes for new orders, production, supplier deliv eries, inventories, and employment. The National Association o f Pur chasing Management (NAPM) surveys over 300 firms in 20 manufac turing industries, weighting responses by industry share of GDP. Ag gregate and average weekly hours are paid hours of production and nonsupervisory employees. The inventory-sales ratio uses nominal (current-dollar) inventory and sales data. Page 6: The contribution of a component X, to the overall GDP growth rate in quarter t is 100 x [(1 + (X - X,.i)/GDPt-i)* - 1], The sign is changed for imports. This calculation forces components to add up to the GDP growth rate before compounding and does not exactly match Survey o f Current Business, Table 8.2. The residual line is calculated using the finest level of detail in the table. Page 7: Ten-year Treasury yields are adjusted to constant maturity. Three-month yields are secondary market averages, but all rates used in the yield curves are adjusted to constant maturity. The total return on the Standard and Poor’s 500 is dividends as a percent of the value of the index plus the percent change in the index. Pages 8,9: Oil prices are monthly averages of daily spot prices for West Texas intermediate crude (Wall Street Journal) . Consumer price index is for all urban consumers. The consumption chain price index is the index associated with the personal consumption expenditures component of GDP. The Employment Cost Index (ECI) covers non farm, nonfederal employers. ECI compensation refers to a fixed sam ple of jobs, while compensation per hour covers all workers in the nonfarm business sector in a given quarter. In both cases, compensa tion is wages and salaries plus benefits. Pages 10,11: Nonfarm payroll employment is counted in a survey of about 390,000 establishments (Current Employment Survey). It ex cludes self-employed individuals and workers in private households, but double-counts individuals with more than one job. The household survey (Current Population Survey) of about 50,000 households pro vides estimates of civilian employment, unemployment rate, labor force participation rate, and employment-population ratio. Population is civilian, noninstitutional, 16 years and over. New population controls introduced in January 1997 affect levels and growth rates of household survey employment, labor force and population. The unemployment rate and other ratios are minimally affected. 90 percent confidence intervals for the unemployment rate (± 0.2 percentage points) and change in household survey employment (± 376,000) measure uncer tainty due to sample size. The household survey was changed in Janu ary 1994, so care should be exercised in making short-term compari sons around this date, particularly with the duration data shown on page 10. Other changes in the survey are detailed in Bureau of Labor Statistics, Employment and Earnings, Appendix A. Pages 12, 13: Debt service is an estimate of scheduled interest and principal payments on outstanding debt. The Michigan consumer sentiment index shows changes in a summary measure of consumers’ answers to five questions about their current and expected financial situation, expectations about future economic conditions, and attitudes about making large purchases. The survey is based on a representative sample of U.S. households. Pages 14, 15: Overall gross saving includes government saving, which is the sum of the government surplus and capital consumption (see notes for pages 16 and 17). Net foreign investment (NFI) is U.S. investment abroad minus foreign investment in the U.S. Aside from a statistical discrepancy, NFI also equals the difference between gross domestic investment and saving. Pages 16, 17: Government consumption and investment is current expenditures on goods and services, including capital consumption (depreciation) and gross investment, as reported in the National Income and Product Accounts (NIPA). The unified federal budget deficit differs from NIPA basis in four main ways: (1) NIPA excludes trans actions involving existing assets; (2) NIPA outlays exclude government investment and include consumption of government capital, while unified budget outlays do the reverse; (3) NIPA accounts exclude Puerto Rico and U.S. territories; and (4) various timing issues are handled differently. Outlays and receipts on these pages are from the NIP As, except as noted. Since 1977, the federal fiscal year starts on October 1. Federal debt held by the public includes holdings of the Federal Reserve System and excludes holdings of the social security and other federal trust funds. Federal grants in aid to state and local governments appear in both state and local receipts and federal outlays. Pages 18, 19: The trade balance (shown on a balance o f payments basis) is the difference between exports and imports of goods (merchandise) and services. It is nearly identical in concept to the net exports component of GDP, but differs slightly in accounting details. The investment income balance equals income received from U.S.owned assets in other countries minus income paid on foreign-owned assets in the U.S. The investment income balance is nearly identical in concept to the difference between gross national product and gross domestic product, but differs in accounting details. The current ac count balance is the trade balance plus the balance on investment income plus net unilateral transfers to the U.S. from other countries. Pages 20, 21: Output per hour (Y/H), unit labor cost (C/Y), and compensation per hour (C/H) are indexes which approximately obey the following relationship: %(Y/H) + %(C/Y) = %(C/H) with %() meaning percent changes. Unit labor cost is shown on page 9. Real compensation per hour uses the CPI to adjust for the effects of infla tion. Total factor productivity estimates changes in output that do not correspond to changes in quantities of labor, capital, or intermediate inputs. Inventory valuation adjustments (IVA) remove the effect of changes in the value of existing inventories from corporate profits and proprietors’ income. (This change in value does not correspond to current production and therefore is not part of GDP). Capital con sumption adjustments (CCAdj) increase profits and proprietors’ income by the difference between estimates of economic depreciation and depreciation allowed by the tax code. Components of national income not shown are rental income of persons and net interest. Sources Bureau o f Economic Analysis (BEA), U.S. Dept, o f Commerce National income and product accounts, international trade and i nvestment data (except by country), auto and light truck sales Census Bureau, U.S. Dept, o f Commerce Inventory-sales ratios, retail sales, capital goods orders, housing starts, exports and imports by country Bureau o f Labor Statistics (BLS), U.S. Dept, o f Labor All employment-related data, employment cost index, consumer and producer price indexes, unit labor cost, output per hour, compensa tion per hour, total factor productivity United States Department o f Treasury Unified budget receipts, outlays, deficit Federal Reserve Board Index of industrial production, treasury yields, exchange rates, capac ity utilization, consumer debt service The Survey Research Center, The University o f Michigan Consumer sentiment index The Conference Board Help-wanted advertising index Organization fo r Economic Cooperation and Development (OECD) GDP for major trading partners (not available on FRED) 27 Federal Reserve Bank of St. Louis Post Office Box 442 St. Louis, Missouri 63166 Subscriber: Please include address label with subscription inquiries or address changes.
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