GDP Growth vs. Unemployment Change
This chart plots annualized quarterly U.S. real-GDP growth against the quarterly change in unemployment. It combines BEA and BLS series and shows post-2020 observations separately from a fitted 1949–2019 benchmark. The relationship is empirical and does not establish that output changes alone caused unemployment to move.
The original idea: Changes in unemployment are systematically related to departures of output growth from its normal pace. Read the original ↗ · Plain-language overview ↗
What does it show?
Faster output growth is usually associated with falling unemployment, and the post-2020 observations broadly follow that pattern.
Methodology
Matches quarterly BEA real GDP (FRED GDPC1) with the average of the three monthly seasonally adjusted U-3 unemployment rates (FRED UNRATE). Real GDP growth is the annualized quarter-over-quarter change: 100 × ((GDPt/GDPt−1)^4 − 1). Unemployment is the current quarter's average minus the prior quarter's average, in percentage points. The displayed line is an ordinary least-squares fit of unemployment change on GDP growth over the fixed 1949 Q1–2019 Q4 sample; all available quarters, including 2020 onward, remain visible. Okun's Law is an empirical relationship, not a causal or stable structural coefficient.