Deficit Dropped to 4.1% of GDP in 2013

By Patricia L Johnson

The naysayers can spin the words 24/7, but it’s tough to spin the bottom line, especially one looking as good as ours for the end of FY2013.

The U.S. had Receipts totaling $2.774 trillion dollars and Outlays totaling $3.454 trillion, resulting in a deficit of only $680 billion dollars, or 4.1 percent of GDP. The deficit for FY2012 was well over a trillion dollars at $1.089, so the $409 billion dollar decrease in deficit from 2012 to 2013 is a definite improvement. The actual deficit has continued to drop now for a full three years in a row as follows:

  • $1.300 – 2011 – Percentage of GDP 8.4
  • $1.089 – 2012 – Percentage of GDP 6.8
  • $ 680 – 2013 – Percentage of GDP 4.1

Major contributing factors to the increased revenues are individual income taxes rose by $184 billion, social insurance (payroll) taxes, increased by $103 billion, Social Security and Medicare taxes increased by $112 billion and corporate income taxes rose by $31 billion.

Further good news for the country is the October jobs report with total nonfarm payroll employment rising by 204,000. The 204,000 new jobs for October brought the average job growth over the past 12 months up to 190,000 per month.

Revisions to previously reported data came into play. Total nonfarm payroll employment for August was increased from 193,000 to 238,000 and September was increased from 148,000 to 163,000. Revisions are a common occurrence on the jobs report due to late reporting.

The largest job gains were in the following sectors: Leisure and hospitality, retail trade, professional and technical services, manufacturing and health care.

The BEA released their personal income report for the month of September recently which also contains positive news. Personal income increased by 0.5 percent in September 2013.

Little by little this county is clawing its way out of the hole we landed in after the Great Recession with recent excellent economic indicators. We’re not there yet, but we’re definitely well on our way!

© 2013 Patricia L Johnson

 

 

 

 

 

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