Manufacturing leads U.S. economic growth

Source: Bureau of Economic Analysis

May 02, 2011

Durable-goods manufacturing and retail trade were among the leading contributors to the upturn in U.S. economic growth in 2010, according to preliminary statistics on the breakout of real gross domestic product (GDP) by industry from the Bureau of Economic Analysis. The economic recovery was widespread: 20 of 22 industry groups contributed to real GDP growth.
  • Manufacturing value added a measure of an industry's contribution to GDP rose 5.8% in 2010, a sharp return to growth after declining two consecutive years. Durable-goods manufacturing turned up, increasing 9.9% after declining 12.7% in 2009. Nondurable-goods manufacturing rose 0.8%, after declining 3.4% in 2009.
  • Retail trade value added grew 5.2% in 2010, reflecting increased consumer purchases following two consecutive years of contraction.
  • Information-communications-technology-producing industries increased 16.3% in 2010, returning to double-digit growth for the first time since 2005.
Chart 1.  Annual Growth in Real GDP

Prices:

Growth in value added prices for mining and agriculture were among the largest contributors to the slight acceleration in the GDP price index for 2010. Value added prices measure changes in an industry's unit costs of labor inputs, as well as the profits per unit of output, and reflect differences in growth rates between the industry's output prices and the prices it faces for inputs such as energy, materials, and purchased services.

  • Value added prices for mining rose sharply in 2010, increasing 13.4% after decreasing 40% in 2009, primarily reflecting increases in prices for oil and gas.
  • Value added prices for agriculture rose 14.7% in 2010, after decreasing 21% in 2009, primarily reflecting increases in prices for crops and livestock.
  • Value added prices for the private services-producing sector, which accounts for more than two-thirds of GDP, decelerated in 2010, increasing 0.7% after increasing 1.4% in 2009. Value added prices for the goods-producing sector turned up in 2010, increasing 3.2%.
Chart 2. Annual Percent Changes in Value Added Prices
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