EMBARGOED UNTIL RELEASE AT 8:30 A.M. EDT, TUESDAY, JUNE 7, 2011
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Media: Ralph Stewart (202) 606–2649 BEA 11—25
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ECONOMIC RECOVERY WIDESPREAD ACROSS STATES IN 2010
Advance 2010 and Revised 2007—2009 GDP–by–State Statistics
Real gross domestic product (GDP) increased in 48 states and the District of Columbia in 2010, according to new statistics released today by the U.S. Bureau of Economic Analysis that breakdown GDP by state.1 Durable–goods manufacturing, retail trade, and finance and insurance were leading contributors to the upturn in U.S. economic growth. U.S. real GDP by state grew 2.6 percent in 2010 after declining 2.5 percent in 2009.2
The resurgence in real GDP by state in 2010 was widespread, with all eight BEA regions growing. The Mideast and New England regions grew the fastest, led by finance and insurance and durable–goods manufacturing, respectively.
Durable–goods manufacturing led the recovery in U.S. real GDP by state in 2010; it was the leading contributor to real GDP growth in seven of the eight BEA regions and in 29 states. Durable–goods manufacturing contributed more than two percentage points to growth in Indiana and Oregon and more than one percentage point to growth in Michigan, Wisconsin, and Tennessee.
Retail trade and finance and insurance were also leading contributors to real GDP growth. Retail trade contributed to growth in all eight BEA regions and in every state, and was the leading contributor in Oklahoma and Florida. Finance and insurance was the leading contributor to real GDP growth in five states, contributing more than one percentage point to growth in New York and Connecticut.
Although mining was not an important contributor to real GDP growth for the nation, it was a large contributor in several states. In North Dakota, the fastest growing state in 2010, mining contributed nearly two percentage points to real GDP growth of 7.1 percent.
In contrast to other industries, construction continued to be a drag on real GDP growth. Nationally, construction declined for the sixth consecutive year and detracted from growth in most states. Nevada was particularly hard hit—construction subtracted nearly two percentage points from the state’s real GDP growth.
Per capita real GDP by state in 2010. Alaska’s per capita real GDP of $63,424 was the highest in the nation, 49 percent above the national average. Mississippi’s per capita real GDP of $29,345 was the lowest in the nation, 31 percent below the national average.
Tables 1–3 show these results in more detail; complete detail is available on BEA’s Web site at www.bea.gov.
The next release of GDP by state is scheduled for June 2012. This release will include revised statistics for 2008–2010 and advance statistics for 2011.
Advance Statistics of GDP by State for 2010 by NAICS Sector
The advance statistics of GDP by state for 2010 are based on a more limited set of source data and an abbreviated estimation methodology compared with the standard set of data and the estimation methodology used to prepare the revised NAICS statistics for 2007—2009. The advance GDP–by–state statistics are based primarily on earnings by industry data from BEA’s regional economic accounts, released March 23, 2011, and on advance GDP–by–industry data from BEA’s annual industry accounts, released April 26, 2011. Preliminary farm sector cash receipts data from the U.S. Department of Agriculture are incorporated in the agriculture, forestry, fishing, and hunting sector. Preliminary value of production and price data from the U.S. Department of the Interior and the U.S. Department of Energy are incorporated in the mining sector.
More information on the methodology used to produce the advance 2010 statistics, on the revised GDP–by–state statistics for 2007—2009, and on revisions to the GDP–by–state statistics will appear in an article in the July 2011 issue of the Survey of Current Business, BEA’s monthly journal.
Definitions. GDP by state is the state counterpart of the Nation’s gross domestic product (GDP), the Bureau’s featured and most comprehensive measure of U.S. economic activity. GDP by state is derived as the sum of the GDP originating in all the industries in a state.
The statistics of real GDP by state are prepared in chained (2005) dollars. Real GDP by state is an inflation–adjusted measure of each state’s gross product that is based on national prices for the goods and services produced within that state. The statistics of real GDP by state and of quantity indexes with a base year of 2005 were derived by applying national chain–type price indexes to the current–dollar GDP–by–state values for the 64 detailed NAICS–based industries for 1997 forward and for the 63 detailed SIC–based industries for 1977—1997.
The chain–type index formula that is used in the national accounts is then used to calculate the values of total real GDP by state and of real GDP by state at more aggregated industry levels. Real GDP by state may reflect a substantial volume of output that is sold to other states and countries. To the extent that a state’s output is produced and sold in national markets at relatively uniform prices (or sold locally at national prices), real GDP by state captures the differences across states that reflect the relative differences in the mix of goods and services that the states produce. However, real GDP by state does not capture geographic differences in the prices of goods and services that are produced and sold locally.
Relation of GDP by state to U.S. Gross Domestic Product (GDP). An industry’s GDP by state, or its value added, in practice, is calculated as the sum of incomes earned by labor and capital and the costs incurred in the production of goods and services. That is, it includes the wages and salaries that workers earn, the income earned by individual or joint entrepreneurs as well as by corporations, and business taxes such as sales, property, and Federal excise taxes—that count as a business expense.
GDP is calculated as the sum of what consumers, businesses, and government spend on final goods and services, plus investment and net foreign trade. In theory, incomes earned should equal what is spent, but due to different data sources, income earned, usually referred to as gross domestic income (GDI), does not always equal what is spent (GDP). The difference is referred to as the “statistical discrepancy.”
Starting with the 2004 comprehensive revision, BEA’s annual industry accounts and its GDP–by–state accounts allocate the statistical discrepancy across all private–sector industries. Therefore, the GDP–by–state statistics are now conceptually more similar to the GDP statistics in the national accounts than they had been in the past.
U.S. real GDP by state for the advance year, 2010, may differ from the Annual Industry Accounts’ GDP by industry and, hence NIPA (National Income and Product Account) GDP, because of different sources and vintages of data used to estimate GDP by state and NIPA GDP. For the revised years of 2007—2009, U.S. GDP by state is nearly identical to GDP by industry except for small differences resulting from the GDP–by–state accounts’ exclusion of overseas Federal military and civilian activity (because it cannot be attributed to a particular state). The GDP–by–industry statistics are identical to those from the 2010 annual revision of the NIPAs, released in July 2010. However, because of revisions since July 2010, GDP in the NIPAs may differ from U.S. GDP by state.
BEA’s national, international, regional, and industry statistics; the Survey of Current Business; and BEA news releases are available without charge on BEA’s Web site at www.bea.gov. By visiting the site, you can also subscribe to receive free e–mail summaries of BEA releases and announcements.
1. Real GDP by state is an inflation–adjusted measure of each state’s production, wherever sold. For a further description, see the “Explanatory Notes” section in this release.
2. For an explanation of the relation between real GDP by state and real GDP in the national income and product accounts (NIPAs), see the section “Relation of GDP by state to U.S. Gross Domestic Product.”