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 2.5 percent in the third quarter of 2011 (that is, from the second quarter to the third quarter) according to the “advance” estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP increased 1.3 percent….
That’s a pretty good report. Not great, but decent. The details of the report are even more encouraging, because they suggest the growth was driven by more business investment and more consumer spending, the two most important factors in a recovery.
Durable-goods purchasing was up 4.1 percent, in contrast to a second-quarter decrease of 5.3 percent. Real nonresidential fixed investment increased 16.3 percent in the third quarter, compared with an increase of 10.3 percent in the second.
And inventory growth was down — “private businesses increased inventories $5.4 billion in the third quarter, following increases of $39.1 billion in the second quarter and $49.1 billion in the first.” In other words, the decent numbers weren’t driven by companies stockpiling inventory that wasn’t selling. To the contrary, “real final sales of domestic product — GDP less change in private inventories — increased 3.6 percent in the third quarter, compared with an increase of 1.6 percent in the second.”
That bodes well for future quarters, and perhaps for jobs.
– Jay Bookman