Archive for the 'Survey of Current Business' Category

BEA’s Industry Economic Accounts to Hit Major Milestone

Roughly every 5 years, the Bureau of Economic Analysis (BEA) releases comprehensive revisions of its major economic accounts. These revisions are generally more detailed than annual revisions, implementing changes in methods, statistics and definitions to better reflect an ever-evolving economy. In December, BEA will release the 2013 comprehensive revision of the Industry Economic Accounts (IEAs), which includes two main sets of statistics, the annual industry accounts and the benchmark input-output (I-O) accounts. That will follow the release in July of a comprehensive revision of the National Income and Product Accounts (NIPAs), or GDP accounts.

The upcoming comprehensive IEA revision will mark a significant milestone: the full integration of the IEAs with the NIPAs, which was first suggested in a March 2004 article in the Survey of Current Business and later amplified in other articles. This enhanced integration, which has long been recommended by economists, will allow for a higher degree of consistency among these widely followed accounts, offering a more consistent view of industry dynamics within the overall economy.

A preview of the 2013 comprehensive revision of the IEAs was published in the June 2013 issue of the Survey.

What is the U.S. Bureau of Economic Analysis?

The U.S. Bureau of Economic Analysis, a unit of the U.S. Department of Commerce, is the federal agency responsible for measuring the U.S. economy, or as some say, BEA is the nation’s accountant. It is responsible for measuring what is produced, what is earned, and how it is spent.  BEA is well known as one of the world’s premier economic statistical agencies, producing some of the most closely watched economic indicators and leading the way in cutting-edge macroeconomic measurement.

Each month, the Bureau pulls together a wealth of data from the public and private sector to provide a comprehensive and consistent picture of economic activity for the nation as a whole and for its various sectors. In addition, the Bureau produces data on U.S. economic interactions with the rest of the world, such as trade and international investment.  These data are considered among the most timely, relevant, and accurate in the world.

BEA is somewhat unique among federal agencies in that it is made up of, and lead by, an entirely career staff; it employs no political appointees. This is done, in part, to ensure the integrity and the perception of the integrity of the nation’s key economic indicators.

The data that BEA produces allow businesses, agencies, researchers, and the American people to better understand what is going on in the U.S. economy. That information is used by people to make financial decisions like whether to buy a home, while businesses rely on the data to make decisions about capital investments and hiring.
  
BEA produces a wide variety of economic statistics through its national, international, regional, and industry accounts. Probably the most common and one of the most important is gross domestic product, or GDP.  GDP is the measure of the total value of all final goods and services produced within the United States during a given period of time. It looks at the activity of consumers, businesses, government agencies, and imports and exports. It is the primary measure of growth in the economy. In the first quarter of 2012, GDP exceeded $15 trillion. (Adjusted for inflation, GDP topped $13.5 trillion.)  
GDP and the related BEA accounts are used for a wide variety of economic policy purposes. 

For example:

  • GDP accounts are used by the Administration and Congress to prepare the federal budget projections.  
  • GDP accounts are used by the Federal Reserve Board to formulate monetary policy. Two of the most important variables guiding monetary policy are real GDP growth and inflation as measured by BEA’s personal consumption expenditures price index.
  • BEA regional data are used to distribute more than $327 billion in federal funds for Medicaid, Title I Education Grants, the Children’s Health Insurance Program, and other programs to state and local governments.

In addition to GDP, BEA produces other economic indicators and posts them on its Web site.  You can explore these statistics through the interactive data tables or through the archive of the Survey of Current Business, the Bureau’s monthly journal.