BEA Releases Second Estimate of Fourth Quarter 2021 Gross Domestic Product (GDP)
COVID-19 Impact on the Fourth-Quarter 2021 GDP Estimate: The increase in fourth quarter GDP reflected the continued economic impact of the COVID-19 pandemic. In the fourth quarter, COVID-19 cases 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 fourth quarter because the impacts are generally embedded in source data and cannot be separately identified.
Real gross domestic product (GDP) increased at an annual rate of 7.0 percent in the fourth quarter of 2021, according to the "second" estimate released by the Bureau of Economic Analysis. In the third quarter, real GDP increased 2.3 percent. The increase in real GDP primarily reflected increases in private inventory investment, exports, PCE, and nonresidential fixed investment that were partly offset by decreases in both federal and state and local government spending. Imports, which are a subtraction in the calculation of GDP, increased.
The increase in private inventory investment was led by retail and wholesale trade industries. Within retail, inventory investment by motor vehicle dealers was the leading contributor. The increase in exports reflected increases in both goods and services. The increase in exports of goods was
widespread, and the leading contributors were consumer goods, foods, feeds, and beverages, as well as industrial supplies and materials. The increase in exports of services was led by travel. The increase in PCE primarily reflected an increase in services, led by health care, financial services and insurance, and transportation. The increase in nonresidential fixed investment primarily reflected an increase in intellectual property products that was partly offset by a decrease in structures. The decrease in federal government spending primarily reflected a decrease in defense spending on intermediate goods and services. The decrease in state and local government spending reflected a decrease in gross investment (led by new educational structures). The increase in imports primarily reflected an increase in goods (led by non-food and non-automotive consumer goods, as well as capital goods). Real GDP accelerated in the fourth quarter, increasing 7.0 percent after increasing 2.3 percent in the third quarter. The acceleration in real GDP primarily reflected upturns in exports and residential investment, and accelerations in private inventory investment and consumer spending, that were partly offset by a downturn in state and local government spending. Imports accelerated.
Updates to GDP: The increase in fourth-quarter real GDP was revised up 0.1 percentage point from the “advance” estimate. The updated estimates reflected upward revisions to nonresidential fixed investment, state and local government spending, and residential fixed investment that were partly offset by downward revisions to consumer spending, exports, and federal government spending. Imports were revised down.