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AEO2012 Early Release Overview

Release Date: January 23, 2012   |  Full Report Release Date: June 2012   |   Report Number: DOE/EIA-0383ER(2012)

Economic growth

Recovery from the 2008-2009 recession is expected to show the slowest growth of any recovery since 1960. Table 2 compares average annual growth rates over a five-year period following U.S. recessions that have occurred since 1960. For the most recent recession, the expected five-year average annual growth rate in real GDP from 2009 to 2014 is 1.3 percentage points below the corresponding average for the three past recessions, with consumption and non-farm employment recovering even more slowly. The slower growth in the early years of the projection has implications for the long term, with a lower economic growth rate leading to a slower recovery in employment and higher unemployment rates. Real GDP in 2035 is 4 percent lower in the AEO2012 Reference case than was projected in the AEO2011 Reference case.

Real GDP grows by an average of 2.6 percent per year from 2010 to 2035 in the AEO2012 Reference case, 0.1 percent per year lower than in the AEO2011 Reference case. The Nation's population, labor force, and productivity grow at annual rates of 0.9 percent, 0.7 percent, and 1.9 percent, respectively, from 2010 to 2035.

Beyond 2012, the economic assumptions underlying the AEO2012 Reference case reflect trend projections that do not include short-term fluctuations. Economic growth projections for 2012 are consistent with those published in EIA's October 2011 Short-Term Energy Outlook.

Table 2. Average annual growth rates over a five-year period following post-1960 recessionsa
Recession ending Real GDP Real consumption Real investment Nonfarm employment Unemployment rate
1975 3.7% 3.2% 7.3% 3.3% -3.3%
1982 4.5% 4.7% 7.5% 2.6% -8.6%
1991 3.3% 3.4% 8.5% 2.0% -4.6%
2009b 2.5% 2.1% 9.4% 1.0% -3.5%
aThe recessions highlighted in Table 2 are recessions in which the annual GDP percentage change was negative when compared with the previous year's annual value of GDP. The 2001 recession was not included even though it technically qualified as a recession (where two successive quarters showed negative economic growth). The 2001-2002 recession showed a slowdown in annual GDP growth but did not show negative growth.
bAverage over five-year period following the recession ending in 2009 includes projections for 2011-2014.