More State Economies Grew In 2017, Led By the West and the South


Real gross domestic product (GDP) increased in 47 states and the District of Columbia and declined in three states in 2017 compared to 2016, according to the U.S. Bureau of Economic Analysis. In 2016, 40 states and the District of Columbia recorded growth in GDP while ten states experienced a decline in GDP.

As a result, nationwide growth in GDP, measured on a seasonally adjusted annual rate basis, reached 2.1% in 2017, which is a 0.6 percentage points higher than the 2016 level of 1.5%. Across all the states and the District of Columbia, GDP growth in 2017 ranged from 4.4% in Washington to -0.2% in Louisiana and Connecticut.

The growth in 2017 occurred across each region of the country, but was led by the West and the South. The acceleration in growth between 2016 and 2017 reflected faster growth in Northeast and the South.

Eighteen states recorded growth above the national growth rate of 2.1% while 29 states and the District of Columbia recorded growth between 2.0%-0.3%. Out of the 18 states which recorded growth above the national rate, eight are from the West (total 13 states in the west) and seven are from the South (total 17 states in the South).

Kansas, Louisiana, and Connecticut recorded declines in GDP growth during this time. In Connecticut, Finance, insurance, real estate, rental, and leasing posted the largest decline in 2017. Agriculture, forestry, fishing, and hunting was the biggest drag on the state GDP in Kansas while Manufacturing posted the largest decline in Louisiana.

The construction sector component of GDP includes both residential and non-residential construction in the private sector, as well as state and federal government spending. It’s important to note that while the trends more generally in the same direction, there is a difference between the BEA’s construction measure and Census’ construction put-in-place. BEA’s measure underestimates the Census Bureau estimate because new construction by industries of their own facilities is included in that industry’s output, not in the construction industry output. In addition, maintenance and repair construction is not considered industry output in the put-in-place data but is included in GDP by Industry. In addition, the put-in-place data includes intermediate costs, such as the costs of materials and supplies, and the costs of engineering or architectural services.

Nationwide, the construction sector spending levels declined to 0.7% in 2017 compared to 3.3% in 2016 (SAAR). Over the year, 26 states and the District of Columbia recorded an increase in the construction sector while 24 states recorded a decline.

The real estate and rental and leasing sector includes renting, leasing, or otherwise allowing the use of tangible or intangible assets (except copyrighted works), and providing related services. Nationwide, the real estate and rental and leasing sector declined to 1.8% in 2017 compared to 2.4% in 2016 (SAAR).

Forty-seven and the District of Columbia recorded an increase in the real estate and rental and leasing sector while two states declined in this sector between the 2016 and 2017.  Connecticut recorded no change during this time period.

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3 replies

  1. Thanks for the information and the article. I am a real estate agent in New Mexico. It is amazing how every state around us is experiencing great growth. As usual New Mexico is lagging in almost every metric.

  2. Looks like the Midwest and the rust belt are having a hard time, or at least just not thriving as well as the rest of the US. I wonder what we can do to change that?

  3. Definitely the west site is attracting more customers as compared to southern site because western is much developed than the southern.

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