Council of Economic Advisers Blog

  • Income, Poverty, and Health Insurance in the United States in 2013

    Today’s report from the Census Bureau shows that key indicators of poverty and family income improved in 2013. Moreover, there is reason to believe that this progress has continued into 2014, as the labor market has strengthened and millions have gained health insurance coverage. At the same time, the data also offer a clear illustration of the large amount of work that remains to strengthen the middle class in the wake of the worst recession since the Great Depression. To address this challenge, the President will continue to do everything in his power to ensure that hard work pays off with decent wages and financial security. And he will also continue to push Congress to take constructive steps that invest in job creation, boost wages, and ensure equal pay for equal work.

    FIVE KEY POINTS IN TODAY’S REPORT FROM THE CENSUS BUREAU

    1. The overall poverty rate declined to 14.5 percent in 2013 due to the largest one-year drop in child poverty since 1966. The poverty rate for people under age 18 fell by 1.9 percentage point from 2012 to 2013, equivalent to 1.4 million young people lifted out of poverty. Poverty rates for other age groups (18-64 and 65+) were little changed. The official poverty rate for 2013 remains above its pre-recession rate. This official poverty rate does not reflect the full effect of anti-poverty policies because it excludes the direct effect of key measures like the Supplemental Nutrition Assistance Program (SNAP) and the Earned Income Tax Credit (EITC). Notably, the EITC was expanded in 2009, and those expansions were subsequently extended. Accounting for such policies would reduce the number of people counted as being in poverty by millions. 

  • Second Estimate of GDP for the Second Quarter of 2014

    Today’s revision affirms that economic growth in the second quarter was strong, consistent with the recent string of solid job growth and improvements in other economic indicators. But there's more work that needs to be done to build on this momentum. That is why the President continues to act on his own to facilitate investment in American manufacturing, energy, and infrastructure, as well as take steps to improve the financial security of working families.

    FIVE KEY POINTS IN TODAY'S REPORT FROM THE BUREAU OF ECONOMIC ANALYSIS

    1. Real gross domestic product (GDP) increased 4.2 percent at an annual rate in the second quarter of 2014, according to the second estimate from the Bureau of Economic Analysis. The strong second-quarter growth represents a rebound from a first-quarter decline in GDP that largely reflected transitory factors like unusually severe winter weather and a sharp slowdown in inventory investment. Growth in consumer spending and business investment picked up in the second quarter, and residential investment increased following two straight quarters of decline. Additionally, state and local government spending grew at the fastest quarterly rate in five years. However, net exports subtracted from overall GDP growth, as imports grew faster than exports. Real gross domestic income (GDI), an alternative measure of the overall size of the economy, was up 4.7 percent in Q2.

  • The Employment Situation in July

    Total job growth exceeded 200,000 for the sixth straight month in July, the first time that has happened since 1997. This encouraging trend in the labor market is consistent with other recent economic indicators, including the strong second-quarter GDP growth reported on Wednesday. To ensure this momentum can be sustained, the President is pressing Congress to act to create jobs and expand opportunity, while simultaneously using his own executive authority to encourage investment in the United States, boost the income of working families, and ensure safe and fair treatment of American workers.

    FIVE KEY POINTS IN TODAY’S REPORT FROM THE BUREAU OF LABOR STATISTICS

    1. The private sector has added 9.9 million jobs over 53 straight months of job growth, the longest streak on record. Today we learned that total nonfarm payroll employment rose by 209,000 in July, mainly reflecting a 198,000 increase in private employment. Private-sector job growth in May and June were revised up slightly, so that over the past twelve months, private employment has risen by a total of 2.5 million. 

  • Advance Estimate of GDP for the Second Quarter of 2014

    Economic growth in the second quarter was strong, consistent with the recent further improvement in the labor market and other indicators. The economy could do even better if Congress does its part to help — starting with taking the steps needed to ensure that work on our roads and bridges is not brought to a halt this fall. But to make further progress, the President is pressing ahead on his own authority, taking action to facilitate investments in American manufacturing, energy, and infrastructure.

    FIVE KEY POINTS IN TODAY’S REPORT FROM THE BUREAU OF ECONOMIC ANALYSIS

    1. Real gross domestic product (GDP) increased 4.0 percent at an annual rate in the second quarter of 2014, according to the advance estimate from the Bureau of Economic Analysis. The second-quarter increase in GDP follows a first-quarter decline that was slightly less steep than previously reported. In the second quarter, growth in consumer spending and business investment picked up from the previous quarter, and residential investment increased following two straight quarters of decline. Additionally, state and local government spending grew at the fastest quarterly rate in five years. However, net exports subtracted from overall GDP growth, as imports grew faster than exports. Over the last four quarters, real GDP has risen 2.4 percent.

  • The Employment Situation in June

    The 1.4 million jobs added in the first half of this year are the most in any first half since 1999. Furthermore, this is the first time since September 1999-January 2000 we have seen total job growth above 200,000 for five straight months. While today’s jobs report is encouraging, many families are still struggling with long-term unemployment and wages that have been stagnant for decades. The President continues to press Congress to take steps to further strengthen the economy, including passing a transportation bill to avoid jeopardizing hundreds of thousands of jobs later this year. But he will also continue to make progress using his own authority to increase economic opportunity, support wage growth, and ensure America’s workplaces are adapting to the 21st century.

    FIVE KEY POINTS IN TODAY’S REPORT FROM THE BUREAU OF LABOR STATISTICS

  • Third Estimate of GDP for the First Quarter of 2014

    First-quarter GDP was revised down today, largely reflecting updated estimates of consumer spending on health care, which was substantially lower than originally reported, as well as exports, which were below the initial estimates. The GDP data can be volatile from quarter to quarter; a range of other data show a more positive picture for the first quarter, and more up-to-date indicators from April and May suggest that the economy is on track for a rebound in the second quarter. The recovery from the Great Recession, however, remains incomplete, and the President will continue to do everything he can to support the recovery, either by acting through executive action or by working with Congress on steps that would boost growth and speed job creation.

    FIVE KEY POINTS IN TODAY’S REPORT FROM THE BUREAU OF ECONOMIC ANALYSIS

    1. Real gross domestic product (GDP) fell 2.9 percent at an annual rate in the first quarter of 2014, according to the third estimate from the Bureau of Economic Analysis. This drop follows an increase of 3.4 percent at an annual rate in the second half of 2013. The entire decline in overall GDP in the first quarter can be accounted for by a decline in exports and a slowdown in inventory investment, two particularly volatile components of GDP. In addition, several components were likely affected by unusually severe winter weather, including consumer spending on food services and accommodations, which fell for the first time in four years.