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Key Growth Measures Diverge, Complicating Recession Debate

Despite two quarters of GDP decline, the U.S. is not currently in a recession, says the official arbiter of such things, the NBER’s Business Cycle Dating Committee.

By Reade Pickert | August 27, 2022 at 06:20 PM

The U.S. government’s main measures of growth in the nation’s economy pointed in different directions in the first half of 2022, adding to the ongoing debate around the health of the economy.

Inflation-adjusted gross domestic product (GDP), or the total value of all goods and services produced in the economy, decreased at a 0.6 percent annualized rate in the April-to-June period, Commerce Department data showed Thursday. That reflects an upward revision in consumer spending; previously, the Commerce Department reported a 0.9 percent contraction.

However, the other, lesser-known official measure of economic growth—known as gross domestic income (GDI)—climbed at a 1.4 percent rate in the second quarter, after increasing 1.8 percent in the first three months of the year. GDI measures activity by calculating all income generated from producing goods and services, like compensation and company profits.

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