Board of Governors of the Federal Reserve System

Figure 1. Industrial Production vs. Goods GDP: Recent Trends

This is a line chart titled “Industrial Production vs. Goods GDP: Recent Trends.” The x axis ranges from 1959q1 to 2024q3 in quarters. The y axis ranges from 0 to 700, with 100 denoting the 1960 levels. The data are quarterly. There are two variables charted on the plot. The first variable is the goods component of GDP, indexed at its 1960 value; is labeled “Goods GDP”; is designated by a thick red line; and ranges from 97 in 1960q4 to 650 in 2024q3. This variable has trended upward since the 1960s with decline concentrated during recessions, flagged by the gray bars. The second variable measures industrial production, indexed at its 1960 value; is labeled “Industrial Production”; is designated by a black line; and ranges from around 95 in 1961q1 to 440 in 2007q4. This variable has also experienced an upward trend until 2007; after the recovery following the Great Recession, it has remained roughly flat. The two series have been tracking each other fairly closely through the early 2000s.

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Figure 2. Industrial Production vs. Goods GDP: Main Components

This is a line chart titled “Industrial Production vs. Goods GDP: Main Components” with four panels. In all panels, the x axis ranges from 1959q1 to 2024q3 in quarters. The top panel is titled “Consumer Durables.” In this panel, the y axis ranges from 0 to 3000, with 100 denoting the 1960 levels. The data are quarterly. There are two variables charted on this panel. The first variable is the consumer durable goods component of GDP, indexed at its 1960 value; is labeled “Expenditure”; is designated by a thick red line; and ranges from 93 in 1961q2 to 2600 in 2024q3. This variable has trended upward since the 1960s with decline concentrated during recessions, flagged by the gray bars. The second variable measures consumer durable goods production; is indexed at its 1990 value; is labeled “Production”; is designated by a thin black line; and ranges from around 93 in 1959q1 to 523 in 2022q2. This variable has also experienced an upward trend through the early 2000s; afterwards, it has remained roughly flat. The second panel is titled “Consumer Nondurables.” In this panel, the y axis ranges from 0 to 500, with 100 denoting the 1960 levels. The data are quarterly. There are two variables charted on this panel. The first variable is the consumer nondurable goods component of GDP, indexed at its 1960 value; is labeled “Expenditure”; is designated by a thick red line; and ranges from 97 in 1959q1 to 485 in 2024q3. This variable has trended upward since the 1960s with decline concentrated during recessions, flagged by the gray bars. The second variable measures consumer nondurable goods production; is indexed at its 1960 value; is labeled “Production”; is designated by a thin black line; and ranges from around 95 in 1959q1 to 280 in 2007q1. This variable has also experienced an upward trend through around 2007; following the declines of the Great Recession, it has remained roughly flat. The third panel is titled “Equipment.” In this panel, the y axis ranges from 0 to 3000, with 100 denoting the 1960 levels. The data are quarterly. There are two variables charted on this panel. The first variable is the expenditure component of GDP, indexed at its 1960 value; is labeled “Expenditure”; is designated by a thick red line; and ranges from 92 in 1961q1 to 2570 in 2024q3. This variable has trended upward since the 1960s with large declines concentrated during recessions, flagged by the gray bars. The second variable measures equipment production; is indexed at its 1960 value; is labeled “Production”; is designated by a thin black line; and ranges from around 92 in 1959q1 to 1150 in 2008q1. This variable has experienced a slight upward trend through around 2007; afterwards, it has remained roughly flat. The bottom panel is titled “Residential and Nonresidential Investment.” In this panel, the y axis ranges from 50 to 350, with 100 denoting the 1960 levels. The data are quarterly. There are two variables charted on this panel. The first variable is the residential and nonresidential investment component of GDP, indexed at its 1960 value; is labeled “Expenditure”; is designated by a thick red line; and ranges from 98 in 1959q1 to 315 in 2006q1. This variable has trended upward through the mid-2000s; after significant declines during the Great Recession, it has partially recovered. The second variable measures production of construction supplies; is indexed at its 1960 value; is labeled “Production”; is designated by a thin black line; and ranges from around 95 in 1961q1 to 300 in 2006q1. This variable has tracked the corresponding expenditure component fairly well.

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Figure 3. Industrial Production vs. Goods GDP: The Role of Imports

This is a line chart titled “Industrial Production vs. Goods GDP: The Role of Imports” with three panels. In the first two panels, the x axis ranges from 1980q1 to 2024q3 in quarters. The top panel is titled “Consumer Durables.” In this panel, the y axis ranges from 0 to 700, with 100 denoting the 1985 levels. The data are quarterly. There are three variables charted on this panel. The first variable is the consumer durable goods component of GDP, indexed at its 1985 value; is labeled “Expenditure”; is designated by a thick red line; and ranges from 65 in 1980q2 to 670 in 2024q3. This variable has trended upward since the 1980s with decline concentrated during recessions, flagged by the gray bars. The second variable measures consumer durable goods component of GDP after subtracting durable goods imports; is indexed at its 1985 value; is labeled “Import-Adjusted”; is designated by a dashed blue line; and ranges from around 70 in 1980q2 to 660 in 2024q3. This variable has also experienced an upward trend, but the increases have been more moderate after 2010. The third variable measures consumer durable goods production; is indexed at its 1985 value; is labeled “Production”; is designated by a thin black line; and ranges from around 80 in 1980q3 to 215 in 2022q2. This variable has also experienced an upward trend through the early 2000s; afterwards, it has remained roughly flat. The middle panel is titled “Consumer Nonenergy Nondurables.” In this panel, the y axis ranges from 50 to 300, with 100 denoting the 1985 levels. The data are quarterly. There are three variables charted on this panel. The first variable is the consumer nonenergy nondurable goods component of GDP, indexed at its 1985 value; is labeled “Expenditure”; is designated by a thick red line; and ranges from 97 in 1980q3 to 250 in 2024q3. This variable has trended upward since the 1980s with decline concentrated during recessions, flagged by the gray bars. The second variable measures consumer nonenergy nondurable goods component of GDP after subtracting nonenergy nondurable goods imports; is indexed at its 1985 value; is labeled “Import-Adjusted”; is designated by a dashed blue line; and ranges from around 89 in 1980q3 to 225 in 2024q3. This variable has also experienced an upward trend, but the increases have been more moderate since the mid-1990s. The third variable measures consumer nonenergy nondurable goods production; is indexed at its 1985 value; is labeled “Production”; is designated by a thin black line; and ranges from around 92 in 1980q3 to 138 in 2006q4. This variable has also experienced an upward trend through around 2007; afterwards, it has remained roughly flat. The bottom panel is titled “Equipment.” In this panel, the x axis ranges from 1990q1 to 2024q3 in quarters, and the y axis ranges from 50 to 400, with 100 denoting the 1985 levels. The data are quarterly. There are three variables charted on this panel. The first variable is the expenditure component of GDP, indexed at its 1995 value; is labeled “Expenditure”; is designated by a thick red line; and ranges from 68 in 1991q2 to 405 in 2024q3. This variable has trended upward since the 1980s with decline concentrated during recessions, flagged by the gray bars. The second variable measures the equipment component of GDP after subtracting equipment imports; is indexed at its 1995 value; is labeled “Import-Adjusted”; is designated by a dashed blue line; and ranges from around 85 in 1992q1 to 167 in 2014q3. This variable has also experienced an upward trend only through the early 2000s and has been roughly flat afterwards; it trended down in recent years. The third variable measures equipment production; is indexed at its 1995 value; is labeled “Production”; is designated by a thin black line; and ranges from around 77 in 1991q4 to 163 in 2022q3. This variable has experienced a slight upward trend through around 2007; afterwards, it has remained roughly flat.

Import-adjusted spending indexes move closer to the production indexes, although the contribution differs dramatically across the three panels. Indeed, imports account only for about 11 of the divergence between production and spending on consumer durables (panel A). In the case of consumer nondurables (panel B), subtracting imports closes substantially more of the gap with production—or, on average, around 50 percent since the early 1990s. Finally, for equipment (panel C), the divergence between spending and production is entirely due to imports.

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Figure 4. Producer vs. Final Consumer Price Indexes

This is a line chart titled “Producer vs. Final Consumer Price Indexes” with two panels. In both panels, the x axis ranges from 1980q1 to 2024q3 in quarters. The top panel is titled “Consumer Durables.” In this panel, the y axis ranges from 40 to 160, with 100 denoting the 1985 levels. The data are quarterly. There are two variables charted on this panel. The first variable is the final consumer domestic price index for consumer durables, indexed at its 1985 value; is labeled “Final Consumer - Domestic”; is designated by a dashed blue line; and ranges from 48 in 2018q3 to 102 in 1994q3. This variable has trended downward since the mid-1990s despite a slight pick-up in recent years. The second variable measures the producer price index for consumer durables; is indexed at its 1985 value; is labeled “Producer”; is designated by a black line; and ranges from around 96 in 1987q3 to 139 in 2024q3. This variable has, instead, experienced an upward trend since the late 1990s. The bottom panel is titled “Consumer Nondurables.” In this panel, the y axis ranges from 50 to 350, with 100 denoting the 1985 levels. The data are quarterly. There are two variables charted on this panel. The first variable is the final consumer domestic price index for consumer nondurables, indexed at its 1985 value; is labeled “Final Consumer - Domestic”; is designated by a dashed blue line; and ranges from 82 in 1980q1 to 221 in 2023q3. This variable has trended upward since the 1980s. The second variable measures the producer price index for consumer durables; is indexed at its 1985 value; is labeled “Producer”; is designated by a black line; and ranges from around 89 in 1980q3 to 340 in 2022q3. This variable has also experienced an upward trend, but it has been volatile in recent decades.

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Figure 5. Profit Margins

This is a line chart titled “Profit Margins” with two panels. In both panels, the x axis ranges from 1980 to 2023 in years. The top panel is titled “Wholesalers.” In this panel, the y axis ranges from 3.8 to 6. The data are yearly. There is only one variable charted on this panel, the profit margin across wholesalers; is designated by a blue line with diamond markers; and ranges from 3.9 in 2000 to 5.8 in 1984. This variable has been fairly flat despite two level shifts, one in 1986 and one in 2003. The bottom panel is titled “Retailers.” In this panel, the y axis ranges from 8 to 12. The data are yearly. There is one variable charted on this panel, the profit margin across retailers; is designated by a blue line with diamond markers; and ranges from 8 in 1992 to 11.6 in 2023. This variable has trended upward since the early 1990s.

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Figure 6. Industrial Production vs. Goods GDP: The Contribution of Wholesalers and Retailers

This is a line chart titled “Industrial Production vs. Goods GDP: The Role of Wholesalers’ and Retailers’ Margins” with two panels. In both panels, the x axis ranges from 1980q1 to 2024q3 in quarters. The top panel is titled “Consumer Durables.” In this panel, the y axis ranges from 0 to 700, with 100 denoting the 1985 levels. The data are quarterly. There are four variables charted on this panel. The first variable is the consumer durable goods component of GDP, indexed at its 1985 value; is labeled “Expenditure”; is designated by a thick red line; and ranges from 65 in 1980q2 to 670 in 2024q3. This variable has trended upward since the 1980s with decline concentrated during recessions, flagged by the gray bars. The second variable measures consumer durable goods component of GDP after subtracting durable goods imports; is indexed at its 1985 value; is labeled “Import-Adjusted”; is designated by a dashed blue line; and ranges from around 70 in 1980q2 to 660 in 2024q3. This variable has also experienced an upward trend, but the increases have been more moderate after 2010. The third variable measures consumer durable goods component of GDP after subtracting durable goods imports and deflated using producer prices; is indexed at its 1985 value; is labeled “Import- and Margin-Adjusted”; is designated by a dotted green line; and ranges from around 55 in 1980q2 to 290 in 2021q2. This variable has also experienced an upward trend through the early 2000s; afterwards, it has remained roughly flat. The fourth variable measures consumer durable goods production; is indexed at its 1985 value; is labeled “Production”; is designated by a thin black line; and ranges from around 80 in 1980q3 to 215 in 2022q2. This variable has also experienced an upward trend through the early 2000s; afterwards, it has remained roughly flat. The bottom panel is titled “Consumer Nonenergy Nondurables.” In this panel, the y axis ranges from 50 to 300, with 100 denoting the 1985 levels. The data are quarterly. There are four variables charted on this panel. The first variable is the consumer nonenergy nondurable goods component of GDP, indexed at its 1985 value; is labeled “Expenditure”; is designated by a thick red line; and ranges from 97 in 1980q3 to 250 in 2024q3. This variable has trended upward since the 1980s with decline concentrated during recessions, flagged by the gray bars. The second variable measures consumer nonenergy nondurable goods component of GDP after subtracting nonenergy nondurable goods imports; is indexed at its 1985 value; is labeled “Import-Adjusted”; is designated by a dashed blue line; and ranges from around 89 in 1980q3 to 225 in 2024q3. This variable has also experienced an upward trend, but the increases have been more moderate since the mid-1990s. The third variable measures consumer nonenergy nondurable goods component of GDP after subtracting durable goods imports and deflated using producer prices; is indexed at its 1985 value; is labeled “Import- and Margin-Adjusted”; is designated by a dotted green line; and ranges from around 89 in 1980q3 to 170 in 2021q4. This variable has also experienced an upward trend through around 2007; afterwards, it has remained roughly flat. The fourth variable measures consumer nonenergy nondurable goods production; is indexed at its 1985 value; is labeled “Production”; is designated by a thin black line; and ranges from around 92 in 1980q3 to 138 in 2006q4. This variable has also experienced an upward trend through around 2007; afterwards, it has remained roughly flat.

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