Real gross domestic product -- the output of goods and services produced by labor and property
located in the United States -- increased at an annual rate of 1.8 percent in the first quarter of 2011 (that
is, from the fourth quarter to the first quarter) according to the "advance" estimate released by the
Bureau of Economic Analysis. In the fourth quarter, real GDP increased 3.1 percent.
The Bureau emphasized that the first-quarter advance estimate released today is based on source
data that are incomplete or subject to further revision by the source agency (see the box on page 3). The
"second" estimate for the first quarter, based on more complete data, will be released on May 26, 2011.
The increase in real GDP in the first quarter primarily reflected positive contributions from
personal consumption expenditures (PCE), private inventory investment, exports, and nonresidential
fixed investment that were partly offset by negative contributions from federal government spending and
state and local government spending. Imports, which are a subtraction in the calculation of GDP,
increased.
The deceleration in real GDP in the first quarter primarily reflected a sharp upturn in imports, a
deceleration in PCE, a larger decrease in federal government spending, and decelerations in
nonresidential fixed investment and in exports that were partly offset by a sharp upturn in private
inventory investment.
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BOX.--
Annual Revision of the National Income and Product Accounts
The annual revision of the national income and product accounts (NIPAs) will be released along
with the "advance" estimate of GDP for the second quarter of 2011 on July 29. In addition to the regular
revision of estimates for the most recent 3 years and the first quarter of 2011, GDP and some
components will be revised back to the first quarter of 2003 (see the Technical Note). The August
Survey of Current Business will contain an article that describes the annual revision in detail.
_____________________
FOOTNOTE.--Quarterly estimates are expressed at seasonally adjusted annual rates, unless otherwise
specified. Quarter-to-quarter dollar changes are differences between these published estimates.
Percent changes are calculated from unrounded data and are annualized. Real estimates are in chained
(2005) dollars. Price indexes are chain-type measures.
This news release is available on BEAs Web site along with the Technical Note and Highlights
related to this release.
_____________________
Motor vehicle output added 1.40 percentage points to the first-quarter change in real GDP after
subtracting 0.27 percentage point from the fourth-quarter change. Final sales of computers added 0.12
percentage point to the first-quarter change in real GDP after adding 0.35 percentage point to the fourth-
quarter change.
The price index for gross domestic purchases, which measures prices paid by U.S. residents,
increased 3.8 percent in the first quarter, compared with an increase of 2.1 percent in the fourth.
Excluding food and energy prices, the price index for gross domestic purchases increased 2.2 percent in
the first quarter, compared with an increase of 1.1 percent in the fourth.
Real personal consumption expenditures increased 2.7 percent in the first quarter, compared with
an increase of 4.0 percent in the fourth. Durable goods increased 10.6 percent, compared with an
increase of 21.1 percent. Nondurable goods increased 2.1 percent, compared with an increase of 4.1
percent. Services increased 1.7 percent, compared with an increase of 1.5 percent.
Real nonresidential fixed investment increased 1.8 percent in the first quarter, compared with an
increase of 7.7 percent in the fourth. Nonresidential structures decreased 21.7 percent, in contrast to an
increase of 7.6 percent. Equipment and software increased 11.6 percent, compared with an increase of
7.7 percent. Real residential fixed investment decreased 4.1 percent, in contrast to an increase of 3.3
percent.
Real exports of goods and services increased 4.9 percent in the first quarter, compared with an
increase of 8.6 percent in the fourth. Real imports of goods and services increased 4.4 percent, in
contrast to a decrease of 12.6 percent.
Real federal government consumption expenditures and gross investment decreased 7.9 percent
in the first quarter, compared with a decrease of 0.3 percent in the fourth. National defense decreased
11.7 percent, compared with a decrease of 2.2 percent. Nondefense increased 0.1 percent, compared
with an increase of 3.7 percent. Real state and local government consumption expenditures and gross
investment decreased 3.3 percent, compared with a decrease of 2.6 percent.
The change in real private inventories added 0.93 percentage point to the first-quarter change in
real GDP after subtracting 3.42 percentage points from the fourth-quarter change. Private businesses
increased inventories $43.8 billion in the first quarter, following increases of $16.2 billion in the fourth
quarter and $121.4 billion in the third.
Real final sales of domestic product -- GDP less change in private inventories -- increased 0.8
percent in the first quarter, compared with an increase of 6.7 percent in the fourth.
Gross domestic purchases
Real gross domestic purchases -- purchases by U.S. residents of goods and services wherever
produced -- increased 1.8 percent in the first quarter, in contrast to a decrease of 0.2 percent in the
fourth.
Disposition of personal income
Current-dollar personal income increased $256.0 billion (8.3 percent) in the first quarter,
compared with an increase of $128.5 billion (4.1 percent) in the fourth. The sharp acceleration in
personal income primarily reflected a downturn in contributions for government social insurance -- a
subtraction in the calculation of personal income -- resulting from provisions of the Tax Relief,
Unemployment Insurance Reauthorization and Job Creation Act of 2010 that reduced the social security
contribution rate by 2 percentage points for 2011.
Personal current taxes increased $63.3 billion in the first quarter, compared with an increase of
$26.9 billion in the fourth.
Disposable personal income increased $192.7 billion (6.9 percent) in the first quarter, compared
with an increase of $101.6 billion (3.6 percent) in the fourth. Real disposable personal income increased
2.9 percent, compared with an increase of 1.9 percent.
Personal outlays increased $169.1 billion (6.4 percent) in the first quarter, compared with an
increase of $142.6 billion (5.4 percent) in the fourth. Personal saving -- disposable personal income less
personal outlays -- was $663.6 billion in the first quarter, compared with $640.0 billion in the fourth.
The personal saving rate -- saving as a percentage of disposable personal income -- was 5.7 percent in
the first quarter, compared with 5.6 percent in the fourth. For a comparison of personal saving in BEAs
national income and product accounts with personal saving in the Federal Reserve Boards flow of funds
accounts and data on changes in net worth, go to /national/nipaweb/Nipa-Frb.asp.
Current-dollar GDP
Current-dollar GDP -- the market value of the nation's output of goods and services -- increased
3.7 percent, or $135.0 billion, in the first quarter to a level of $15,006.4 billion. In the fourth quarter,
current-dollar GDP increased 3.5 percent, or $126.3 billion.
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BOX.--
Information on the assumptions used for unavailable source data is provided in a technical note
that is posted with the news release on BEA's Web site. Within a few days after the release, a detailed
"Key Source Data and Assumptions" file is posted on the Web site. In the middle of each month, an
analysis of the current quarterly estimate of GDP and related series is made available on the Web site;
click on Survey of Current Business, "GDP and the Economy."
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* * *
BEA's national, international, regional, and industry estimates; the Survey of Current Business; and
BEA news releases are available without charge on BEA's Web site at www.bea.gov. By visiting the
site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements.
* * *
Next release -- May 26, 2011, at 8:30 A.M. EDT for:
Gross Domestic Product: First Quarter 2011 (Second Estimate)
Corporate Profits: First Quarter 2011 (Preliminary Estimate)
Comparisons of Revisions to GDP
Quarterly estimates of GDP are released on the following schedule: the advance estimate, based on
source data that are incomplete or subject to further revision by the source agency, is released near the end of the
first month after the end of the quarter; as more detailed and more comprehensive data become available,
the second and third estimates are released near the end of the second and third months, respectively. The
latest estimate reflects the results of both annual and comprehensive revisions.
Annual revisions, which cover the quarters of the 3 most recent calendar years, are usually carried out
each summer and incorporate newly available major annual source data. Comprehensive (or benchmark)
revisions are carried out at about 5-year intervals and incorporate major periodic source data, as well as
improvements in concepts and methods that update the accounts to portray more accurately the evolving U.S.
economy.
The table below shows comparisons of the revisions between quarterly percent changes of current-dollar
and of real GDP for the different vintages of the estimates. From the advance estimate to the second estimate (one
month later), the average revision to real GDP without regard to sign is 0.5 percentage point, while from the
advance estimate to the third estimate (two months later), it is 0.6 percentage point. From the advance estimate to
the latest estimate, the average revision without regard to sign is 1.3 percentage points. The average revision
(with regard to sign) from the advance estimate to the latest estimate is 0.3 percentage point, which is larger than
the average revisions from the advance estimate to the second or to the third estimates. The larger average
revisions to the latest estimate reflect the fact that comprehensive revisions include major improvements, such as
the incorporation of BEAs latest benchmark input-output accounts. The quarterly estimates correctly indicate the
direction of change of real GDP 98 percent of the time, correctly indicate whether GDP is accelerating or
decelerating 74 percent of the time, and correctly indicate whether real GDP growth is above, near, or below trend
growth more than three-fifths of the time.
Revisions Between Quarterly Percent Changes of GDP: Vintage Comparisons
[Annual rates]
Vintages Average Average without Standard deviation of
compared regard to sign revisions without
regard to sign
____________________________________________________Current-dollar GDP_______________________________________________
Advance to second.................... 0.2 0.5 0.4
Advance to third..................... .2 .7 .4
Second to third...................... .0 .3 .2
Advance to latest.................... .4 1.2 .9
________________________________________________________Real GDP_____________________________________________________
Advance to second.................... 0.1 0.5 0.4
Advance to third..................... .1 .6 .4
Second to third...................... .0 .2 .2
Advance to latest.................... .3 1.3 1.0
NOTE.--These comparisons are based on the period from 1983 through 2007.
