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November 1995, Vol. 118, No. 11
The U.S. economy to 2005
Norman C. Saunders
The Bureau of Labor Statistics has prepared projections of the U.S. economy for the period 1994-2005.1 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 and their implications for employment over the next 11 years, based on different assumptions regarding those factors most subject to uncertainty in future periods.
The moderate-growth projection is characterized by a gross domestic product (GDP) influenced by somewhat slower labor force growth than currently exists, an improving balance of foreign trade, modest improvements in labor productivity, several key shifts in the distribution of the demand components of GDP, and a gradually improving Federal budget deficit. In comparison, the high-growth model has greater population, labor force, and labor productivity growth; marked shifts in demand toward investment and exports; a more optimistic foreign trade outlook; and a balanced Federal budget by the end of the projection period. Finally, the low-growth scenario contains a lower estimate of labor force growth, a continuation of recent trends in demand shares and labor productivity growth, and a deteriorating budget deficit and foreign trade balance.
Under the assumptions used by the Bureau in developing these projections, by 2005 GDP is expected to range between $6.4 trillion and $7.4 trillion (in 1987 dollars). This translates to an average annual rate of growth for real GDP of 1.6 percent in the low-growth alternative, 2.3 percent in the moderate-growth scenario, and 3.0 percent in the high-growth alternative over the 1994-2005 period, contrasting with a historical rate of 2.9 percent between 1983 and 1994. Real disposable personal income ranges between $4.5 trillion and $5.2 trillion, and disposable income per capita, also in real terms (that is, 1987 dollars), is projected to range from roughly $15,800 to $17,700 in 2005, compared with $14,700 in 1994.
This excerpt is from an article published in the November 1995 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 in the Monthly Labor Review, November 1993. The series was entitled "The American Workforce: 1992-2005."
How accurate are recent BLS occupational projections? October 1991.
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