The Bureau of Economic Analysis plans to release in 2015 a modified economic model to replace the original Regional Input-Output Modeling System (RIMS II). Cost savings will be realized because the modified model will be updated less frequently.
Much like RIMS II, the modified model will produce regional “multipliers” that can be used in economic impact studies to estimate the total economic impact of a project on a region.
However, the modified model will be updated with new input-output (I-O) data only for benchmark years. That is — years ending in two and seven. The modified model will become available to customers in 2015 and incorporate 2007 benchmark I-O data and 2012 regional economic data.
Last year, as a result of budget sequestration and reduced funding levels, BEA discontinued updates to RIMS II. Orders for RIMS II multipliers, however, have continued to be accepted because the cost of fulfilling these orders is covered by a nominal processing fee.
After investigating ways to continue to meet the analytical needs of our customers but do so at a lower cost to BEA, the bureau decided to make a modified economic model available. Until the modified model is available in 2015, customers may continue to buy RIMS II multipliers.
Real gross domestic product (GDP) decreased 2.9 percent in the first quarter of 2014, according to the “third” estimate released today by the Bureau of Economic Analysis. In the fourth quarter of 2013, real GDP increased 2.6 percent.
The decline in real GDP was largely accounted for by significant declines in nonfarm inventory investment and in net exports.
In addition, state and local government spending, business investment, and housing investment also contributed to the real GDP decline.
In contrast, consumer spending increased, notably in services (mainly home utilities).
The first-quarter real GDP growth rate was revised down 1.9 percentage points from the second estimate released in May, based on newly available source data.
- Consumer spending was revised down, primarily reflecting a downward revision to services, mainly to health care.
- Exports of goods were revised down, reflecting revisions to industrial supplies and materials and to foods, feeds, and beverages. Exports of services were also revised down.
- Imports of goods were revised up, mainly non-auto capital goods as well as vehicles, engines, and parts. Imports of services were also revised up, mainly travel services.
BEA’s featured measure of corporate profits declined 9.1 percent at a quarterly rate in the first quarter, after increasing 2.2 percent in the previous quarter, according to updated estimates. The decline was the largest since the fourth quarter of 2008.
- Profits of nonfinancial corporations fell 8.0 percent after rising 1.5 percent.
- Profits of financial corporations fell 15.1 percent after rising 1.3 percent.
- Profits from the rest of the world fell 5.8 percent after rising 5.5 percent.
Over the last 4 quarters, corporate profits fell 2.2 percent.
State personal income increased 0.8 percent on average in the first quarter of 2014, an acceleration from the 0.5 percent growth in the fourth quarter of 2013. Personal income grew in 46 states and growth accelerated in 24 of those states. The fastest growth, 1.4 percent, was in Washington state, Vermont, and West Virginia. Personal income fell 2.9 percent in North Dakota, 0.3 percent in South Dakota, and 0.2 percent in Arkansas and Nebraska. Inflation, as measured by the national price index for personal consumption expenditures, was 0.3 percent in the first quarter, the same as in the fourth quarter.