Tuesday, December 23, 2008

GDP Revision: Productivity Perspective

The Commerce Department regularly updates its national accounting estimates. Today they reported that GDP fell 0.5% at an annual rate 2008 Q2 to 2008 Q3, which is the same as it had previously estimated for that time period.

Employment fell 1.1 percent at an annual rate over the same time period. Aggregate hours worked fell 2.2 percent at an annual rate over the same time period. With GDP falling less than labor, we conclude that productivity was rising -- despite the Boeing strike and the major hurricane that occurred in Q3.

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