Real gross domestic product (GDP) increased in all 50 states and the District of Columbia in the third quarter of 2023. According to the U.S. Bureau of Economic Analysis (BEA), the percent change in real GDP increase ranged from 9.7 percent in Kansas to 0.7 percent in Arkansas.
Nationwide, growth in real GDP (measured on a seasonally adjusted annual rate basis) increased a stunning 4.9 percent in the third quarter of 2023, after an increase of 2.1 percent in the second quarter of 2023. Retail trade, nondurable goods manufacturing, and construction were the leading contributors to the increase in real GDP across the country.
Regionally, real GDP growth increased in all regions from the second quarter of 2023 to the third quarter. The percent change in real GDP ranged from a 7.1 percent increase in the Southwest region (Arizona, New Mexico, Oklahoma, and Texas) to a 4.0 percent increase in the Mideast region (Delaware, District of Columbia, Maryland, New Jersey, New York, and Pennsylvania).
Overall, 14 out of 21 industry groups [i]contributed to the increase in real GDP. Retail trade, nondurable goods manufacturing, construction, and information were the leading contributors to the increase in real GDP in the third quarter of 2023. On the other hand, industry groups that offset the national GDP growth include utilities, arts, entertainment, and recreation, and agriculture, forestry, fishing, and hunting.
At the state level, the category for agriculture, forestry, fishing, and hunting was the leading contributor to growth in Kansas (9.7 percent) and Nebraska (7.5 percent), the states with the largest and third-largest increases in real GDP. Retail trade was the leading contributor to growth in Texas (7.7 percent) and Idaho (7.0 percent), the states with the second- and fourth-largest increases in real GDP. Nondurable-goods manufacturing was the leading contributor to growth in Louisiana (6.6 percent), the state with the fifth-largest increase in real GDP.
[i] BEA prepares quarterly estimates for 23 industry groups. For this analysis, Federal Civilian, Military, and State and Local are combined under “Government and government enterprises”.
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Fascinating insights into state-level GDP in Q3 2023. Regions experiencing economic upturns might see increased demand for real estate development, potentially driving the need for construction loans. Lenders should assess state-specific trends to capitalize on emerging opportunities and provide tailored financial solutions for the evolving construction landscape