The decline in U.S. auto sales alone pulled the nation’s gross domestic product down by half a percent between the third quarter of 2007 and the third quarter of 2008, according to research by James D. Hamilton, a professor of economics at University of California, San Diego.
In the absence of auto sales declines, Hamilton states, the real GDP would have grown over the period, and it is unlikely that economists would have deemed the time period as a true economic recession.
Auto sales are not the only impact on the nation’s economy from the U.S. auto industry; automaker job losses also had a profound impact. One-hundred and twenty-five thousand jobs were lost in U.S. auto manufacturing between July 2007 and August 2008, according to Hamilton’s research.