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November 1993, Vol. 116, No. 11
The American Workforce, 1992 to 2005
The U.S. economy to 2005: framework for BLS projections
Norman C. Saunders
The Bureau of Labor Statistics has prepared projections of the U.S. economy to the year 2005.1 As with prior BLS aggregate economic projections, three alternatives have been developed: low growth, moderate growth, and high growth. These alternatives are designed to examine a range of production possibilities over the next 13 years, based on different assumptions regarding those factors most open to question in future periods.
The moderate-growth projection is characterized by a gross domestic product (GDP) influenced by a very modestly slower labor force growth than currently exists, an improved balance of foreign trade, some improvements in labor productivity, several key shifts in the distribution of the demand component of GDP, and a gradually improving Federal budget balance. In comparison, the high-growth model has higher population, labor force, and labor productivity growth; marked shifts in demand toward investment and exports; and more optimistic foreign trade balances. Finally, the low-growth version contains a lower estimate of labor force growth and a continuation of recent trends in demand shares and labor productivity growth.
Under the assumptions used by BLS in developing these projections, by 2005, GDP is expected to range between $6.0 trillion and $7.3 trillion (in 1987 dollars). This translates to an average annual rate of growth for real GDP of 1.5 percent in the low-growth alternative, 2.2 percent in the moderate-growth scenario, and 3.0 percent in the high growth alternative over the 1992 to 2005 period, contrasting with a historical rate of 2.5 percent between 1979 and 1989. Real disposable personal income ranges between $4.5 trillion and $5.5 trillion, and disposable income per capita, in nominal terms (that is, current dollars), is projected to range between $35,000 and $44,800, compare with 1992 level of $17,600.
This excerpt is from an article published in the November 1993 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.
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1 Previously published projections to the year 2005 appeared as a series of five articles, entitled "Outlook: 1990-2005," in the Monthly Labor Review, November 1991.
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