There were 1,686 press releases posted in the last 24 hours and 400,114 in the last 365 days.

CBO’s Economic Forecast: Understanding Productivity Growth

CBO regularly publishes economic projections that are consistent with current law—providing a basis for its estimates of federal revenues, outlays, deficits, and debt. A key element in CBO’s projections is its forecast of potential (maximum sustainable) output, which is based mainly on estimates of the potential labor force, the flow of services from the capital stock, and potential total factor productivity in the nonfarm business sector. This presentation describes CBO’s most recent 10-year projections of potential output, highlighting the importance of potential total factor productivity. It discusses the historic slowdown of growth in total factor productivity, as well as changes in total factor productivity during the coronavirus pandemic, and it explores possible explanations for the slowdown and implications for the future.