Probably not. Federal populations increased. State populations decreased, likely due to budget crunches created by the recession. We know about that here in California. A key line from the report: The majority (83%) of the decline in the correctional population during the year was attributed to the decrease in the probation population (down 81,800 offenders). Chalk this up as another effect of the bureaucracy.
After more than thirty years of constant increase, prison populations have leveled off and in the last few years have begun to decline (pdf). It’s a momentous change and Keith Humphreys argues that the story has been under-reported because few people want to play up the good news