GDP revisions: Economic recovery was even weaker than we thought

July 27, 2012

Everything we thought we knew about the recovery was wrong. Or, at least, it was a little off. On Friday, the Bureau of Economic Analysis published its annual revisions (pdf) to the GDP figures for the past four years, based on fuller data. Here's a chart showing the changes:


A few notable points emerge. For one, the economic contraction in 2009 has been revised so as to be slightly less severe than estimated last year. (Though it's worth noting that the recession in 2008 and 2009 was much, much deeper than the available economic data suggested at the time.) As the Wall Street Journal's Neil Shah observes, this seems to be because government was doing more to hold up the deteriorating economy than previously thought.

All told, however, the current economic recovery has been weaker than previously estimated. In fact, it's now the second-weakest in the postwar era. From the "official" end of the recession in 2009 to the end of 2011, the economy grew 5.8 percent, instead of 6.2 percent. As Eric Morath and Sarah Portlock note, only the brief recovery during the early years of the Reagan administration, in 1980 and 1981, was weaker.

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