Global| Jul 25 2019State GDP in 2019:Q1
|in:Viewpoints
Summary
Real GDP growth by state continued to be centered in the West in 2019:Q1, although West Virginia's pace, 5.2% at an annual rate, was the fastest in the nation. Eight of the nine other states in the top ten were in the West, led by [...]
Real GDP growth by state continued to be centered in the West in 2019:Q1, although West Virginia's pace, 5.2% at an annual rate, was the fastest in the nation. Eight of the nine other states in the top ten were in the West, led by Texas's 5.1%--Delaware was number 7, at 3.9%. For comparison, in current dollars, Texas's GDP is more than 20 times the size of West Virginia's and more than 10 times the size of West Virginia's and Delaware's put together. Hawaii was the slowest growing state (a 1.2% rate), but two medium- to large eastern states were 48 and 49 (New Jersey and Maryland). However, three large Eastern states (New York, Ohio, and Georgia) grew at rates above 3%, while California's pace of expansion was only a moderate 2.7%.
State GDP estimates are derived by distributing national figures on industry output across the states. The sluggish growth rate of Maryland (and DC, which grew at a 1.4% annual rate) was likely closely connected to the partial Federal government shutdown; government output declines played a noticeable role in holding down aggregate output in both (there were other states that also saw marked declines in government output; Hawaii, though, did not see an especially large drop in government. Weakness in a broad array of private sectors accounted for Hawaii's poor showing). New Jersey was apparently held back by a decline in real estate output. Estimates of quarterly growth in that sector can be seen as problematic; the bulk of real estate output is the imputed income of homeowners—an especially large element of New Jersey's economy—and substantial quarterly moves could be regarded with some suspicion. West Virginia, as well as numbers of other large energy-producing states, mostly in the West, was buoyed by large increases in mining output.
The timing of this release is a little unusual. Tomorrow will see the first estimate of 2019:Q2 GDP for the nation as a whole, along with revisions to the numbers for the last few years. Thus, until the second quarter state GDP figures and revisions are released in November, the comparability of the state and national numbers will be weaker than normal.
Charles Steindel
AuthorMore in Author Profile »Charles Steindel has been editor of Business Economics, the journal of the National Association for Business Economics, since 2016. From 2014 to 2021 he was Resident Scholar at the Anisfield School of Business, Ramapo College of New Jersey. From 2010 to 2014 he was the first Chief Economist of the New Jersey Department of the Treasury, with responsibilities for economic and revenue projections and analysis of state economic policy. He came to the Treasury after a long career at the Federal Reserve Bank of New York, where he played a major role in forecasting and policy advice and rose to the rank of Senior Vice-President. He has served in leadership positions in a number of professional organizations. In 2011 he received the William F. Butler Award from the New York Association for Business Economics, is a fellow of NABE and of the Money Marketeers of New York University, and has received several awards for articles published in Business Economics. In 2017 he delivered Ramapo College's Sebastian J. Raciti Memorial Lecture. He is a member of the panel for the Federal Reserve Bank of Philadelphia's Survey of Professional Forecasters and of the Committee on Research in Income and Wealth. He has published papers in a range of areas, and is the author of Economic Indicators for Professionals: Putting the Statistics into Perspective. He received his bachelor's degree from Emory University, his Ph.D. from the Massachusetts Institute of Technology, and is a National Association for Business Economics Certified Business EconomistTM.