Real gross domestic product (GDP) decreased at an annual rate of 1.5 percent in the first quarter of 2022 (table 1), according to the "second" estimate released by the Bureau of Economic Analysis. In the fourth quarter, real GDP increased 6.9 percent.
The GDP estimate released today is based on more complete source data than were available for the "advance" estimate issued last month. In the advance estimate, the decrease in real GDP was 1.4 percent. The update primarily reflects downward revisions to private inventory investment and residential investment that were partly offset by an upward revision to consumer spending (refer to "Updates to GDP").
The decrease in real GDP reflected decreases in private inventory investment, exports, federal government spending, and state and local government spending, while imports, which are a subtraction in the calculation of GDP, increased. Personal consumption expenditures (PCE), nonresidential fixed investment, and residential fixed investment increased (table 2).
COVID-19 Impact on the First-Quarter 2022 GDP Estimate
In the first quarter, an increase in COVID-19 cases related to the Omicron variant resulted in continued restrictions and disruptions in the operations of establishments in some parts of the country. Government assistance payments in the form of forgivable loans to businesses, grants to state and local governments, and social benefits to households all decreased as provisions of several federal programs expired or tapered off. The full economic effects of the COVID-19 pandemic cannot be quantified in the GDP estimate for the first quarter because the impacts are generally embedded in source data and cannot be separately identified. For more information, refer to the Technical Note and Federal Recovery Programs and BEA Statistics.
The decrease in private inventory investment was led by decreases in wholesale trade (mainly motor vehicles) as well as mining, utilities, and construction (notably, utilities). Within exports, widespread decreases in nondurable goods were partly offset by an increase in "other" business services (mainly financial services). The decrease in federal government spending primarily reflected a decrease in defense spending on intermediate goods and services. The increase in imports was led by increases in durable goods (notably, nonfood and nonautomotive consumer goods).
The increase in PCE reflected widespread increases in services (led by housing and utilities). Within goods, an increase in durable goods (led by motor vehicles and parts) was offset by a decrease in nondurable goods (led by gasoline and other energy goods). The increase in nonresidential fixed investment reflected increases in equipment and intellectual property products.
Current‑dollar GDP increased 6.5 percent at an annual rate, or $381.5 billion, in the first quarter to a level of $24.38 trillion. In the fourth quarter, GDP increased 14.5 percent, or $800.5 billion (table 1 and table 3). More information on the source data that underlie the estimates is available in the "Key Source Data and Assumptions" file on BEA's website.
The price index for gross domestic purchases increased 8.0 percent (revised) in the first quarter, compared with an increase of 7.0 percent in the fourth quarter (table 4). The PCE price index increased 7.0 percent, compared with an increase of 6.4 percent. Excluding food and energy prices, the PCE price index increased 5.1 percent (revised), compared with an increase of 5.0 percent.
Current-dollar personal income increased $248.3 billion (revised) in the first quarter to a level of $21.26 trillion. In the fourth quarter, personal income increased $186.3 billion (revised). The increase primarily reflected an increase in compensation that was partly offset by a decrease in government social benefits (table 8). In the first quarter, government assistance payments in the form of social benefits to households decreased as provisions of several federal programs expired or continued to taper off.
Disposable personal income decreased $7.5 billion (revised), or 0.2 percent, in the first quarter, in contrast to an increase of $72.4 billion (revised), or 1.6 percent, in the fourth quarter. Real disposable personal income decreased 6.7 percent (revised), compared with a decrease of 4.5 percent (revised).
Personal saving was $1.03 trillion (revised) in the first quarter, compared with $1.45 trillion (revised) in the fourth quarter. The personal saving rate—personal saving as a percentage of disposable personal income—was 5.6 percent (revised) in the first quarter, compared with 7.9 percent (revised) in the fourth quarter.
Gross Domestic Income and Corporate Profits
Real gross domestic income (GDI) increased 2.1 percent in the first quarter, compared with an increase of 6.3 percent (revised) in the fourth quarter. The average of real GDP and real GDI, a supplemental measure of U.S. economic activity that equally weights GDP and GDI, increased 0.3 percent in the first quarter, compared with an increase of 6.6 percent (revised) in the fourth quarter (table 1).
Profits from current production (corporate profits with inventory valuation and capital consumption adjustments) decreased $66.4 billion in the first quarter, in contrast to an increase of $20.4 billion in the fourth quarter (table 10).
Profits of domestic financial corporations decreased $28.6 billion in the first quarter, compared with a decrease of $1.3 billion in the fourth quarter. Profits of domestic nonfinancial corporations decreased $21.1 billion, in contrast to an increase of $5.0 billion. Rest-of-the-world profits decreased $16.7 billion, in contrast to an increase of $16.8 billion. In the first quarter, receipts increased $21.3 billion, and payments increased $38.0 billion.
Updates to GDP
The decrease in first-quarter real GDP was revised down 0.1 percentage point from the "advance" estimate, primarily reflecting downward revisions to private inventory investment and residential fixed investment that were mostly offset by upward revisions to consumer spending and exports. Imports were revised up. For more information, refer to the Technical Note. For information on updates to GDP, refer to the "Additional Information" section that follows.
Updates to Fourth-Quarter Wages and Salaries
In addition to presenting updated estimates for the first quarter, today's release presents revised estimates of fourth-quarter 2021 wages and salaries, personal taxes, and contributions for government social insurance, based on updated data from the Bureau of Labor Statistics Quarterly Census of Employment and Wages program. Wages and salaries are now estimated to have increased $341.0 billion in the fourth quarter, an upward revision of $66.6 billion. With the incorporation of these new data, real gross domestic income is now estimated to have increased 6.3 percent in the fourth quarter, an upward revision of 1.2 percentage points from the previously published estimate.