Current and Historical Data for Real GDP
Review the current and historical data for real gross domestic product (GDP) by quarter at Economagic.com.
Economic Growth Rate (Relative to Same Period Last Year) and the Unemployment Rate
One of the lessons of the business cycle is that the unemployment rate and the rate of economic growth tend to be inversely related. This relationship is particularly clear when we look in the diagram at economic data during and after recessions. During a recession unemployment rates rise while real GDP falls. In contrast, you can see that unemployment rates fall while real GDP rises in the period of recovery. The 2001 recession was unusual in that it took several years of economic recovery for the unemployment rate to finally begin to decline. The macroeconomy is in a relatively favorable condition with moderate economic growth and a declining unemployment rate.
Real GDP and Personal Income: Annual Percent Change Relative to Same Period Last Year
Recall from the circular flow of a market economy that households receive income from selling resources (land, labor, and capital) to firms. GDP can be measured by adding up all of the payments to households for land, labor, and capital. Thus when real GDP increases, personal income will also increase, and when real GDP decreases, so too will personal income. Since 2004 we have seen a moderation in economic growth and a sharp decline in the growth rate in personal income.
Real GDP and the Index of Leading Economic Indicators: Annual Percent Change Relative to Same Period Last Year
How well does the Index of Leading Economic Indicators perform in forecasting future economic conditions? As one can see in the diagram, the Index of Leading Economic Indicators generally provides a strong indication of future turning points in the economy. While each of the four recessions since 1980 was anticipated by a decline in the Index of Leading Economic Indicators, the Index also falsely indicated a recession in the mid-1990s. The pattern of the Index of Leading Economic Indicators falling prior to recessions is clearly revealed in the time period between 2000 and 2002. Please note that the formula for creating the Index changed in June 2005 to reflect 1996 as the base year rather than 1992, which inflates changes in the Leading Index in relation to the old data. Following over a year of slowing growth, the Index of Leading Economic Indicators actually declined in the fourth quarter of 2007, the first decline in two years. This may be a brief aberration or may portend a further slowing of economic growth.