GDP and the Economy

Third Estimates for the Second Quarter of 2021

Volume 101, Number 10  |  October 20, 2021

Download PDF

Real gross domestic product (GDP) increased at an annual rate of 6.7 percent in the second quarter of 2021, according to the third estimates of the National Income and Product Accounts (NIPAs) (chart 1 and table 1).1 With the third estimate, real GDP growth for the second quarter was revised up 0.1 percentage point from the second estimate issued last month (see “Updates”). In the first quarter of 2021, real GDP increased 6.3 percent.

The increase in real GDP in the second quarter reflected increases in consumer spending, nonresidential fixed investment, exports, and state and local government spending that were partly offset by decreases in private inventory investment, residential fixed investment, and federal government spending.2 Imports, which are a subtraction in the calculation of GDP, increased (chart 2 and table 1).


Chart 1. Real GDP: Percent Change from Preceding Quarter

[Click chart to expand]


Chart 2. Real GDP: Contributions to the Percent Change in 2021:Q1

[Click chart to expand]

Real GDP accelerated in the second quarter of 2021 as the economic recovery from the COVID-19 pandemic continued. A smaller decrease in inventory investment, an upturn in exports, an acceleration in consumer spending, and an upturn in state and local government spending were mostly offset by downturns in residential fixed investment and federal government spending and a slowdown in nonresidential fixed investment. Imports slowed.

  • The smaller decrease in inventory investment primarily reflected a smaller decrease in manufacturing, an upturn in “other” industries (mainly from upturns in transportation and warehousing and in agricultural services, forestry, and fisheries), and a smaller decrease in retail trade (led by motor vehicle dealers).
  • The upturn in exports reflected upturns in both goods and services exports.
    • The leading contributors to the upturn in exports of goods were consumer goods and capital goods (nonautomotive).
    • The upturn in exports of services was led by upturns in charges for the use of intellectual property and “other” business services.
  • The acceleration in consumer spending reflected an acceleration in spending on services that was partly offset by a deceleration in spending on goods.
    • Within services, the leading contributors to the acceleration were an upturn in health care and a pickup in food services and accommodations.
    • Within goods, all categories of durable goods contributed to the deceleration (led by slowdowns in motor vehicles and parts and furnishings and durable household equipment).
  • The upturn in state and local government spending reflected an acceleration in consumption expenditures (led by compensation of employees) that was partly offset by a larger decrease in gross investment.
  • All categories contributed to the downturn in residential fixed investment. The leading contributors were a slowdown in single-family construction, a downturn in improvements, and a larger decrease in brokers’ commissions.
  • The downturn in federal government spending primarily reflected a downturn in spending on nondefense consumption expenditures, led by intermediate goods and services purchased. In the second quarter, the fees associated with processing and administration of Paycheck Protection Program loan applications by banks on behalf of the federal government slowed.
  • The slowdown in nonresidential fixed investment reflected a downturn in structures (with all categories contributing) and slowdowns in equipment (more than accounted for by a downturn in information processing equipment) and intellectual property products (more than accounted for by a slowdown in software investment).
  • The slowdown in imports reflected a deceleration in goods imports that was partly offset by an acceleration in services imports.
    • The leading contributor to the deceleration in goods imports was a downturn in imports of consumer goods (led by pharmaceuticals).
    • The acceleration in services imports primarily reflected a larger increase in travel.

Real gross domestic income, which is the sum of incomes earned and costs incurred in the production of GDP, increased 2.3 percent in the second quarter after increasing 6.3 percent in the first quarter.

Table 1. Real Gross Domestic Product (GDP) by Expenditure and Related Measures
[Seasonally adjusted at annual rates]
Line Series Share of current-dollar GDP (percent) Change from preceding period (percent) Contribution to percent change in real GDP (percentage points)
2021 2020 2021 2020 2021
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
1 Gross domestic product (GDP)1 100.0 33.8 4.5 6.3 6.7 33.8 4.5 6.3 6.7
2 Personal consumption expenditures 69.0 41.4 3.4 11.4 12.0 25.51 2.26 7.44 7.92
3 Goods 24.3 49.5 −0.3 27.4 13.0 9.92 −0.07 5.69 2.99
4 Durable goods 9.2 89.0 1.1 50.0 11.6 5.49 0.10 3.50 1.01
5 Nondurable goods 15.1 31.8 −1.1 15.9 13.9 4.43 −0.17 2.19 1.98
6 Services 44.6 37.5 5.3 3.9 11.5 15.59 2.34 1.75 4.93
7 Gross private domestic investment 17.3 82.1 24.7 −2.3 −3.9 11.71 4.01 −0.37 −0.65
8 Fixed investment 18.0 27.5 17.7 13.0 3.3 4.88 2.92 2.25 0.61
9 Nonresidential 13.3 18.7 12.5 12.9 9.2 2.72 1.57 1.65 1.21
10 Structures 2.5 −15.3 −8.2 5.4 −3.0 −0.46 −0.22 0.14 −0.08
11 Equipment 5.6 55.9 26.4 14.1 12.1 2.73 1.29 0.75 0.66
12 Intellectual property products 5.2 8.1 10.2 15.6 12.5 0.45 0.50 0.76 0.62
13 Residential 4.7 59.9 34.4 13.3 −11.7 2.16 1.34 0.60 −0.60
14 Change in private inventories −0.8 ...... ...... ...... ...... 6.84 1.10 −2.62 −1.26
15 Net exports of goods and services −3.9 ...... ...... ...... ...... −3.25 −1.65 −1.56 −0.18
16 Exports 10.8 54.5 22.5 −2.9 7.6 4.64 2.07 −0.30 0.80
17 Goods 7.6 99.0 25.6 −1.4 6.4 4.75 1.59 −0.10 0.48
18 Services 3.2 −4.9 16.0 −6.0 10.4 −0.11 0.49 −0.20 0.32
19 Imports 14.7 89.2 31.3 9.3 7.1 −7.89 −3.73 −1.26 −0.99
20 Goods 12.4 103.7 30.1 10.6 4.3 −7.37 −3.04 −1.21 −0.51
21 Services 2.3 29.7 37.5 2.2 23.6 −0.52 −0.69 −0.05 −0.48
22 Government consumption expenditures and gross investment 17.7 −2.1 −0.5 4.2 −2.0 −0.19 −0.09 0.77 −0.36
23 Federal 6.9 −5.4 −3.1 11.3 −5.3 −0.32 −0.22 0.78 −0.38
24 National defense 4.0 1.7 5.3 −5.8 −1.1 0.11 0.22 −0.25 −0.04
25 Nondefense 2.9 −14.3 −14.1 40.8 −10.7 −0.43 −0.44 1.02 −0.34
26 State and local 10.8 0.1 1.2 −0.1 0.2 0.13 0.14 −0.01 0.02
Addenda:
27 Gross domestic income (GDI)2 ...... 24.4 19.6 6.3 2.3 ...... ...... ...... ......
28 Average of GDP and GDI ...... 29.0 11.9 6.3 4.5 ...... ...... ...... ......
29 Final sales of domestic product ...... 25.9 3.4 9.1 8.1 26.95 3.44 8.90 7.99
30 Goods 31.5 62.9 4.6 10.8 9.8 17.63 1.46 3.31 3.05
31 Services 59.7 23.8 3.1 4.2 7.9 14.68 1.86 2.52 4.62
32 Structures 8.7 15.6 14.7 5.0 −10.0 1.47 1.22 0.45 −0.94
33 Motor vehicle output 2.7 1,236.8 −12.8 1.1 −14.1 5.97 −0.40 0.03 −0.42
  1. The GDP estimates under the contribution columns are also percent changes.
  2. GDI is deflated by the implicit price deflator for GDP.

Note. Percent changes are from National Income and Product Account (NIPA) tables 1.1.1 and 1.2.1, contributions are from NIPA tables 1.1.2 and 1.2.2, and shares are from NIPA table 1.1.10 or are calculated from NIPA table 1.2.5.

The third estimate of GDP includes estimates of GDP by industry, or value added—a measure of an industry's contribution to GDP. In the second quarter, private goods-producing industries increased 4.7 percent, private services-producing industries increased 7.8 percent, and government increased 3.4 percent (table 2). Overall, 19 of 22 industry groups contributed to the second-quarter increase in real GDP.

  • The increase in private goods-producing industries primarily reflected increases in nondurable goods manufacturing (led by petroleum and coal products), construction, and durable goods manufacturing (led by other transportation equipment).
Chart 3. Real GDP by Sector: Percent Change from Preceding Period

[Click chart to expand]

  • The increase in private services-producing industries primarily reflected increases in accommodation and food services; information (led by data processing, internet publishing, and other information services); professional, scientific, and technical services; real estate and rental and leasing; and health care and social assistance (led by ambulatory health care services). These increases were partly offset by a decrease in retail trade (led by motor vehicle and parts dealers) (table 13).
  • The increase in government mainly reflected an increase in state and local government.

Chart 4. Contributions to Percent Change in Real GDP by Industry Group, 2021:Q2

[Click chart to expand]

Table 2. Real Gross Domestic Product by Industry Group and Related Measures
[Seasonally adjusted at annual rates]
Line Series Share of current-dollar GDP (percent) Change from preceding period (percent) Contribution to percent change in real GDP (percentage points)
2021 2020 2021 2020 2021
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
1 Gross Domestic Product1 100.0 33.8 4.5 6.3 6.7 33.8 4.5 6.3 6.7
2 Private industries 87.9 38.4 5.0 7.1 7.1 32.78 4.32 6.18 6.26
3 Agriculture, forestry, fishing, and hunting 1.1 50.8 −0.6 −13.9 −13.1 0.38 0.00 −0.14 −0.14
4 Mining 1.2 −17.4 −0.1 −3.4 7.3 −0.13 −0.01 −0.03 0.08
5 Utilities 1.6 4.0 −11.0 −8.5 3.8 0.10 −0.18 −0.15 0.06
6 Construction 4.2 27.8 10.9 5.9 6.6 1.24 0.46 0.25 0.28
7 Manufacturing 11.1 64.8 4.0 8.7 5.5 6.13 0.38 0.95 0.63
8 Durable goods 6.0 79.9 6.6 13.0 4.3 4.13 0.41 0.77 0.27
9 Nondurable Goods 5.1 47.6 0.8 3.5 7.0 2.00 −0.03 0.18 0.35
10 Wholesale trade 6.1 43.9 −1.3 3.4 3.7 2.40 −0.13 0.20 0.23
11 Retail trade 6.1 48.1 0.2 17.0 −14.7 2.66 0.01 0.96 −0.97
12 Transporation and warehousing 2.7 68.7 4.7 8.9 −9.7 1.57 0.12 0.24 −0.27
13 Information 5.7 23.3 2.0 14.7 25.2 1.37 0.12 0.79 1.30
14 Finance, insurance, real estate, rental, and leasing 21.3 10.0 6.5 6.1 4.3 2.55 1.43 1.32 0.93
15 Finance and insurance 8.5 12.6 18.9 7.4 3.4 1.28 1.55 0.64 0.30
16 Real estate and rental and leasing 12.8 8.3 −0.9 5.2 4.9 1.27 −0.12 0.68 0.63
17 Professional and business services 12.9 26.8 12.4 12.4 11.8 3.56 1.55 1.55 1.48
18 Professional, scientific, and technical services 7.7 23.5 5.4 10.0 15.3 1.92 0.41 0.76 1.13
19 Management of companies and enterprises 1.9 6.9 30.3 8.0 2.2 0.15 0.54 0.15 0.04
20 Administrative and waste management services 3.2 51.5 20.3 21.4 9.7 1.49 0.60 0.64 0.31
21 Educational services, health care, and social assistance 8.4 66.0 5.5 −1.1 6.1 5.04 0.48 −0.09 0.52
22 Educational services 1.1 16.2 −13.7 8.1 9.2 0.21 −0.17 0.09 0.10
23 Health care and social assistance 7.3 76.1 8.8 −2.5 5.7 4.83 0.65 −0.18 0.42
24 Arts, entertainment, recreation, accomodation, and food services 3.6 326.3 0.6 17.0 68.4 4.75 0.03 0.52 1.83
25 Arts, entertainment, and recreation 0.8 291.0 50.4 36.3 16.0 1.02 0.32 0.25 0.12
26 Accommodation and food services 2.8 337.3 −10.9 11.4 88.7 3.74 −0.29 0.27 1.70
27 Other services, except government 1.9 67.4 2.4 −8.8 17.5 1.17 0.05 −0.18 0.32
28 Government 12.1 6.5 0.9 1.0 3.4 0.98 0.15 0.12 0.42
29 Federal 3.8 4.8 −2.1 −0.4 0.5 0.23 −0.08 −0.01 0.02
30 State and local 8.2 7.3 2.4 1.6 4.8 0.75 0.23 0.14 0.40
  Addenda:
31 Private goods-producing industries2 17.6 48.9 5.2 5.9 4.7 7.62 0.83 1.03 0.84
32 Private services-producing industries3 70.4 36.0 4.9 7.4 7.8 25.17 3.49 5.16 5.42
  1. The GDP estimates under the contribution columns are also percent changes.
  2. Consists of agriculture, forestry, fishing, and hunting; mining; construction; and manufacturing.
  3. Consists of utilities; wholesale trade; retail trade; transportation and warehousing; information; finance, insurance, real estate, rental, and leasing; professional and business services; educational services, health care, and social assistance; arts, entertainment, recreation, accommodation, and food services; and other services, except government.

Note. Percent changes are from these GDP by industry tables: “Value Added by Industry as a Percentage of Gross Domestic Product,” “Percent Changes in Chain-Type Quantity Indexes for Value Added by Industry,” and “Contributions to Percent Change in Real Gross Domestic Product by Industry.”

Gross output by industry—principally a measure of an industry’s sales or receipts, which includes sales to final users in the economy (GDP by expenditure) and sales to other industries (intermediate inputs)—increased 5.5 percent in the second quarter. Private services-producing industries increased 9.5 percent, while private goods-producing industries decreased 2.5 percent, and government decreased 1.6 percent (table 16). Overall, 14 of 22 industry groups contributed to the increase in real gross output.

Chart 5. Real Gross Output by Selected Industries: Percent Change from Preceding Period

[Click chart to expand]

Table 3. Real Gross Output by Industry Group and Related Measures
[Seasonally adjusted at annual rates]
Line Series Change from preceding period (percent)
2020 2021
Q3 Q4 Q1 Q2
1 All industries 28.9 7.2 9.1 5.5
2 Private industries 32.7 8.2 9.6 6.3
3 Agriculture, forestry, fishing, and hunting 15.4 1.3 −5.5 −4.1
4 Mining 1.4 11.9 4.1 13.7
5 Utilities 22.7 1.0 7.2 6.9
6 Construction 1.7 9.1 5.7 −8.3
7 Manufacturing 44.8 4.9 −0.7 −1.7
8 Durable goods 74.3 7.8 3.2 −2.1
9 Nondurable goods 19.3 1.9 −4.7 −1.3
10 Wholesale trade 59.5 11.3 10.9 9.7
11 Retail trade 44.2 0.4 28.8 −4.4
12 Transporation and warehousing 62.6 20.5 20.2 4.3
13 Information 18.7 13.9 19.9 19.4
14 Finance, insurance, real estate, rental, and leasing 10.5 6.0 10.5 1.5
15 Finance and insurance 7.7 8.1 20.0 −1.2
16 Real estate and rental and leasing 12.8 4.3 3.3 3.7
17 Professional and business services 21.1 17.8 14.5 9.2
18 Professional, scientific, and technical services 21.5 14.8 14.4 9.4
19 Management of companies and enterprises 6.0 29.3 2.6 −0.5
20 Administrative and waste management services 30.1 17.7 22.3 14.3
21 Educational services, health care, and social assistance 37.6 7.2 −4.1 9.9
22 Educational services 19.2 −9.0 8.0 15.4
23 Health care and social assistance 40.4 9.6 −5.6 9.2
24 Arts, entertainment, recreation, accomodation, and food services 306.0 2.6 41.1 81.4
25 Arts, entertainment, and recreation 274.0 35.8 76.4 25.3
26 Accommodation and food services 314.4 −4.5 32.8 99.8
27 Other services, except government 61.3 2.5 −4.8 20.1
28 Government 3.9 −0.5 5.1 −1.6
29 Federal −6.4 −3.1 15.5 −6.4
30 State and local 9.2 0.8 0.6 0.8
  Addenda:
31 Private goods-producing industries1 30.0 5.9 0.6 −2.5
32 Private services-producing industries2 33.6 9.0 12.9 9.5
  1. Consists of agriculture, forestry, fishing and hunting; mining; construction; and manufacturing.
  2. Consists of utilities; wholesale trade; retail trade; transportation and warehousing; information; finance, insurance, real estate, rental, and leasing; professional and business services; educational services, health care, and social assistance; arts, entertainment, recreation, accommodation, and food services; and other services, except government.

Note. Percent changes are from the table Percent Changes in Chain-Type Quantity Indexes for Gross Output by Industry which is available through BEA's Interactive Data Application.

Prices for gross domestic purchases—goods and services purchased by U.S. residents—increased 5.8 percent in the second quarter after increasing 3.9 percent in the first quarter (table 4 and chart 6). The pickup mainly reflected widespread accelerations in consumer prices for both services and goods. Notable exceptions include decelerations in the prices paid for gasoline and other energy goods and for health care.

Food prices increased in the second quarter after decreasing slightly in the first quarter. Prices for energy goods and services increased 21.2 percent after increasing 47.8 percent. Gross domestic purchases prices excluding food and energy increased 5.6 percent after increasing 3.2 percent.

Chart 6. Prices for Gross Domestic Purchases

[Click chart to expand]

Table 4. Prices for Gross Domestic Purchases
[Percent change at annual rates; based on seasonally adjusted index numbers (2012=100)]
Line Series Change from preceding period (percent) Contribution to percent change in gross domestic purchases prices (percentage points)
2020 2021 2020 2021
Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
1 Gross domestic purchases1 3.3 1.8 3.9 5.8 3.3 1.8 3.9 5.8
2 Personal consumption expenditures 3.7 1.5 3.8 6.5 2.39 1.00 2.51 4.23
3 Goods 4.9 0.3 5.9 9.3 1.07 0.08 1.29 2.11
4 Durable goods 7.6 0.2 2.3 16.8 0.56 0.02 0.19 1.38
5 Nondurable goods 3.5 0.4 8.0 5.0 0.51 0.06 1.10 0.73
6 Services 3.1 2.1 2.8 5.0 1.32 0.92 1.21 2.12
7 Gross private domestic investment 2.8 1.9 2.8 2.9 0.45 0.32 0.50 0.52
8 Fixed investment 2.2 1.9 3.7 4.5 0.39 0.33 0.64 0.80
9 Nonresidential 0.1 0.4 0.8 0.9 0.02 0.06 0.10 0.13
10 Structures 1.0 0.5 3.9 8.9 0.03 0.01 0.10 0.21
11 Equipment −1.7 −2.2 2.2 −3.2 −0.09 −0.11 0.12 −0.16
12 Intellectual property products 1.6 3.2 −2.3 1.5 0.08 0.16 −0.12 0.08
13 Residential 9.3 6.5 12.4 15.3 0.36 0.27 0.54 0.67
14 Change in private inventories ...... ...... ...... ...... 0.07 −0.01 −0.14 −0.28
15 Government consumption expenditures and gross investment 2.4 3.0 5.4 6.1 0.44 0.52 0.93 1.04
16 Federal 3.0 2.5 4.0 4.1 0.22 0.17 0.27 0.28
17 National defense 3.6 2.5 4.4 4.3 0.15 0.10 0.18 0.17
18 Nondefense 2.2 2.5 3.3 3.9 0.07 0.07 0.09 0.11
19 State and local 2.0 3.3 6.3 7.3 0.22 0.35 0.66 0.76
Addenda:
  Gross domestic purchases:                
20 Food −1.2 0.4 −0.1 1.6 −0.07 0.02 0.00 0.09
21 Energy goods and services 25.4 12.4 47.8 21.2 0.55 0.26 0.91 0.49
22 Excluding food and energy 3.1 1.7 3.2 5.6 2.80 1.56 3.02 5.20
  Personal consumption expenditures:                
23 Food and beverages purchased for off-premises consumption −1.3 0.0 0.7 4.1 ...... ...... ...... ......
24 Energy goods and services 22.1 13.3 47.7 20.4 ...... ...... ...... ......
25 Excluding food and energy 3.5 1.2 2.7 6.1 ...... ...... ...... ......
26 Gross domestic product 3.6 2.2 4.3 6.1 ...... ...... ...... ......
27 Exports of goods and services 13.4 6.2 21.0 19.4 ...... ...... ...... ......
28 Imports of goods and services 8.0 2.2 13.3 13.4 ...... ...... ...... ......
  1. The estimated prices for gross domestic purchases under the contribution columns are also percent changes.

Note. Most percent changes are from NIPA table 1.6.7; percent changes for PCE for food and energy goods and services and for PCE excluding food and energy are from NIPA table 2.3.7. Contributions are from NIPA table 1.6.8. Gross domestic product, export, and import prices are from NIPA table 1.1.7.

In the third estimate for the second quarter, real GDP increased 6.7 percent, an upward revision of 0.1 percentage point from the previously reported estimate. The revision primarily reflected upward revisions to consumer spending, exports, and private inventory investment that were partly offset by an upward revision to imports and a downward revision to residential fixed investment.

  • Within consumer spending, both services and goods were revised up.
    • Within services, the leading contributors to the upward revision were health care (notably, outpatient services), “other” services (notably, personal care and clothing services), and transportation services (notably, air transportation). The upward revisions were partly offset by a downward revision to financial services and insurance (notably, service charges and fees as well as portfolio management and investment advice services).
    • Within goods, the leading contributor to the upward revision was food and beverages purchased for off-premises consumption (groceries).
  • The upward revision to exports primarily reflected an upward revision to services (led by “other” business services, including financial services).
  • Within private inventory investment, upward revisions to retail trade (notably, general merchandise stores) and wholesale trade (notably, petroleum and petroleum products) were partly offset by a downward revision to “other” industries (specifically information).
  • Within imports, both goods and services were revised up.
    • For goods, the leading contributor to the upward revision was industrial supplies and materials (notably, petroleum and related products).
    • For services, the leading contributor was an upward revision to transport (notably, passenger air transport).
  • Within nonresidential fixed investment, a downward revision to intellectual property products (research and development as well as software) was offset by upward revisions to structures (notably, manufacturing structures) and to equipment (notably, computers and peripheral equipment).
Table 5. Second and Third Estimates for the Second Quarter of 2021
[Seasonally adjusted at annual rates]
Line Series Change from preceding period (percent) Contribution to percent change in real GDP (percentage points)
Second estimate Third estimate Third estimate minus second estimate Second estimate Third estimate Third estimate minus second estimate
1 Gross domestic product (GDP)1 6.6 6.7 0.1 6.6 6.7 0.1
2 Personal consumption expenditures 11.9 12.0 0.1 7.80 7.92 0.12
3 Goods 12.8 13.0 0.2 2.95 2.99 0.04
4 Durable goods 11.3 11.6 0.3 0.99 1.01 0.02
5 Nondurable goods 13.7 13.9 0.2 1.96 1.98 0.02
6 Services 11.3 11.5 0.2 4.85 4.93 0.08
7 Gross private domestic investment −4.0 −3.9 0.1 −0.67 −0.65 0.02
8 Fixed investment 3.4 3.3 −0.1 0.63 0.61 −0.02
9 Nonresidential 9.3 9.2 −0.1 1.21 1.21 0.00
10 Structures −5.4 −3.0 2.4 −0.14 −0.08 0.06
11 Equipment 11.6 12.1 0.5 0.63 0.66 0.03
12 Intellectual property products 14.6 12.5 −2.1 0.72 0.62 −0.10
13 Residential −11.5 −11.7 −0.2 −0.58 −0.60 −0.02
14 Change in private inventories ...... ...... ...... −1.30 −1.26 0.04
15 Net exports of goods and services ...... ...... ...... −0.24 −0.18 0.06
16 Exports 6.6 7.6 1.0 0.70 0.80 0.10
17 Goods 6.2 6.4 0.2 0.46 0.48 0.02
18 Services 7.5 10.4 2.9 0.24 0.32 0.08
19 Imports 6.7 7.1 0.4 −0.94 −0.99 −0.05
20 Goods 4.1 4.3 0.2 −0.48 −0.51 −0.03
21 Services 22.4 23.6 1.2 −0.46 −0.48 −0.02
22 Government consumption expenditures and gross investment −1.9 −2.0 −0.1 −0.33 −0.36 −0.03
23 Federal −5.2 −5.3 −0.1 −0.37 −0.38 −0.01
24 National defense −0.9 −1.1 −0.2 −0.04 −0.04 0.00
25 Nondefense −10.6 −10.7 −0.1 −0.33 −0.34 −0.01
26 State and local 0.3 0.2 −0.1 0.04 0.02 −0.02
  Addenda:
27 Final sales of domestic product 7.9 8.1 0.2 7.86 7.99 0.13
28 Gross domestic income (GDI)2 1.6 2.3 ...... ...... ...... ......
29 Average of GDP and GDI 4.0 4.5 ...... ...... ...... ......
30 Gross domestic purchases price index 5.8 5.8 0.0 ...... ...... ......
31 GDP price index 6.1 6.1 0.0 ...... ...... ......
  1. The GDP estimates under the contribution columns are also percent changes.
  2. GDI is deflated by the implicit price deflator for GDP.

Measured in current dollars, profits from current production (corporate profits with the inventory valuation adjustment (IVA) and the capital consumption adjustment (CCAdj)) increased $267.8 billion, or 10.5 percent at a quarterly rate, in the second quarter of 2021 after increasing $123.9 billion, or 5.1 percent, in the first quarter (table 6). Profits of domestic financial corporations increased $52.8 billion, profits of domestic nonfinancial corporations increased $221.3 billion, and rest-of-the-world profits decreased $6.2 billion.

Profits after tax increased $232.9 billion in the second quarter after increasing $95.8 billion in the first quarter.

Table 6. Corporate Profits
[Seasonally adjusted]
Line Series Billions of dollars (annual rate) Percent change from preceding quarter (quarterly rate)
Level Change from preceding quarter
2021 2020 2021 2020 2021
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
  Current production measures:                  
1 Corporate profits with IVA and CCAdj 2,819.2 492.8 −7.9 123.9 267.8 25.4 −0.3 5.1 10.5
2 Domestic industries 2,359.0 446.7 −30.5 134.5 274.0 29.1 −1.5 6.9 13.1
3 Financial 537.8 1.1 17.0 1.3 52.8 0.2 3.6 0.3 10.9
4 Nonfinancial 1,821.3 445.6 −47.5 133.2 221.3 41.7 −3.1 9.1 13.8
5 Rest of the world 460.2 46.2 22.6 −10.6 −6.2 11.3 5.0 −2.2 −1.3
6 Receipts from the rest of the world 892.7 115.7 47.8 34.2 27.4 17.3 6.1 4.1 3.2
7 Less: Payments to the rest of the world 432.5 69.6 25.3 44.8 33.6 26.8 7.7 12.7 8.4
                     
9 Less: Taxes on corporate income 378.6 59.1 15.3 28.1 34.9 24.5 5.1 8.9 10.1
                     
10 Equals: Profits after tax 2,440.6 433.7 −23.3 95.8 232.9 25.5 −1.1 4.5 10.5
11 Net dividends 1,411.0 −27.1 28.9 −37.8 51.4 −1.9 2.1 −2.7 3.8
12 Undistributed profits from current production 1,029.6 460.7 −52.2 133.6 181.5 150.7 −6.8 18.7 21.4
                     
13 Net cash flow with IVA 3,078.6 531.9 −30.2 154.5 224.7 24.2 −1.1 5.7 7.9
CCAdj
Capital consumption adjustment
IVA
Inventory valuation adjustment

Note. Levels of these and other profits series are shown in National Income and Product Account tables 1.12 and 6.16D.

Industry profits (corporate profits by industry with IVA) increased $285.9 billion, or 11.6 percent at a quarterly rate, in the second quarter of 2021 after increasing $104.7 billion, or 4.4 percent, in the first quarter (table 7 and chart 7). The increase was led by increases in “other” nonfinancial industries (more than accounted for by mining), financial, and manufacturing.

Profits after tax (without IVA and CCAdj)—BEA's profits measure that is conceptually most like the profits for companies in the Standard & Poor's 500 Index—increased $322.8 billion in the second quarter.

Table 7. Corporate Profits by Industry
[Seasonally adjusted]
Line Series Billions of dollars (annual rate) Percent change from preceding quarter (quarterly rate)
Level Change from preceding quarter
2021 2020 2021 2020 2021
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2
  Industry profits:                  
1 Corporate profits with IVA 2,747.7 496.5 −3.3 104.7 285.9 26.6 −0.1 4.4 11.6
2 Domestic industries 2,287.6 450.3 −25.9 115.3 292.1 30.9 −1.4 6.1 14.6
3 Financial 576.9 1.9 18.5 −1.1 57.0 0.4 3.7 −0.2 11.0
4 Nonfinancial 1,710.7 448.4 −44.4 116.4 235.1 46.9 −3.2 8.6 15.9
5 Utilities 11.9 −0.7 9.2 1.3 −9.1 −6.0 88.9 6.6 −43.4
6 Manufacturing 450.5 115.4 3.0 36.6 48.6 46.7 0.8 10.0 12.1
7 Wholesale trade 137.6 24.0 10.8 −23.6 25.0 23.6 8.6 −17.3 22.2
8 Retail trade 307.6 40.6 −7.3 37.3 27.4 19.4 −2.9 15.3 9.8
9 Transportation and warehousing 64.4 16.2 2.1 9.7 29.8 249.7 9.2 39.1 86.4
10 Information 175.5 31.4 14.4 3.3 14.5 28.0 10.0 2.1 9.0
11 Other nonfinancial 563.3 221.5 −76.7 51.9 98.8 82.8 −15.7 12.6 21.3
12 Rest of the world 460.2 46.2 22.6 −10.6 −6.2 11.3 5.0 −2.2 −1.3
  Addenda:
13 Profits before tax (without IVA and CCAdj) 3,069.0 629.6 31.6 231.2 357.7 34.6 1.3 9.3 13.2
14 Profits after tax (without IVA and CCAdj) 2,690.4 570.4 16.3 203.1 322.8 36.2 0.8 9.4 13.6
15 IVA −321.2 −133.1 −35.0 −126.5 −71.8 ...... ...... ...... ......
16 CCAdj 71.4 −3.7 −4.6 19.2 −18.1 ...... ...... ...... ......
CCAdj
Capital consumption adjustment
IVA
Inventory valuation adjustment

Note. Levels of these and other profits series are shown in National Income and Product Account tables 1.12, 1.14, 1.15, and 6.16D.

Chart 7. Corporate Profits with Inventory Valuation Adjustment in 2021:Q2, Change from Preceding Quarter

[Click chart to expand]

 

 

  1. “Real” estimates are in chained (2012) dollars, and price indexes are chain-type measures. Each GDP estimate for a quarter (advance, second, and third) incorporates increasingly comprehensive and improved source data; for more information, see “The Revisions to GDP, GDI, and Their Major Components” in the January 2018 Survey of Current Business. Quarterly estimates are expressed at seasonally adjusted annual rates, which reflect a rate of activity for a quarter as if it were maintained for a year.
  2. In this article, “consumer spending” refers to “personal consumption expenditures,” “inventory investment” refers to “change in private inventories,” and “government spending” refers to “government consumption expenditures and gross investment.”