The BEA reported today that U.S. real GDP by state grew 1.5% in 2011 after a 3.1% increase in 2010. Not surprisingly, the "economic miracle state" of North Dakota led the country last year with a whopping growth rate in real GDP of 7.6%, more than five times the national average of 1.5%, and almost three percentage points higher than No. 2 Oregon's growth of 4.7%. On a per-capita basis, North Dakota also ranked No. 1 in the country with a 6.17% increase in its 2011 per-capita real GDP, compared to a 0.73% national average, and a 4.47% increase in No. 2 West Virginia.
More than one-third of North Dakota's economic growth in 2011 came from its mining sector, which contributed 2.81% to the overall 7.6% growth rate last year. Other states with booming energy sectors also experienced above-average growth in state GDP last year, including No. 3 West Virginia (4.5%), No. 4 Texas (3.3%) and No. 5 Alaska (2.5%).
More than one-third of North Dakota's economic growth in 2011 came from its mining sector, which contributed 2.81% to the overall 7.6% growth rate last year. Other states with booming energy sectors also experienced above-average growth in state GDP last year, including No. 3 West Virginia (4.5%), No. 4 Texas (3.3%) and No. 5 Alaska (2.5%).
In a previous release on state personal income, the BEA reported in March that North Dakota led the country in 2011 with the highest gain in state income for 2011 (8.1%), the largest increase in per-capita state income (6.7%), and the highest gain in personal income during the last quarter of 2011 (1.5%).
As I have reported previously, North Dakota's economic success goes beyond its well-publicized energy prosperity, which is being supplemented by other booming sectors including manufacturing, tourism, advanced manufacturing, information technology and agriculture. The state's pro-business climate should get some of the credit for the impressive output and job gains over the last several years, including leading the country in real GDP growth in 2011. Whatever North Dakota is doing, it's working, and the state should be a nationwide model for economic development and job growth - call it the "Dakota Model."
Related: The May 2012 cover story in the American Gas and Oil Reporter highlights how soaring oil production in North Dakota is spurring infrastructure growth: "Across North Dakota, demand is off the charts for everything from drilling rigs and pumping units to housing and office space, driven by a blistering pace of activity in the Bakken Shale play."
As I have reported previously, North Dakota's economic success goes beyond its well-publicized energy prosperity, which is being supplemented by other booming sectors including manufacturing, tourism, advanced manufacturing, information technology and agriculture. The state's pro-business climate should get some of the credit for the impressive output and job gains over the last several years, including leading the country in real GDP growth in 2011. Whatever North Dakota is doing, it's working, and the state should be a nationwide model for economic development and job growth - call it the "Dakota Model."
Related: The May 2012 cover story in the American Gas and Oil Reporter highlights how soaring oil production in North Dakota is spurring infrastructure growth: "Across North Dakota, demand is off the charts for everything from drilling rigs and pumping units to housing and office space, driven by a blistering pace of activity in the Bakken Shale play."
Great North Dakota is a lab experiment that has little or no impact on the national well being.
ReplyDeleteWith a 7,6% growth rate its real GDP increased from 0.24% to 0.26% of the national total.
By comparison, the great liberal state of Massachusetts only had a 2.2% growth rate. But its share of national GDP increased from 2.64% to 2.65%-- about ten times that of North Dakota.
Real GDP in Mass grew some $7,413 billion (2005 $) as compared to $2,429 billion (2005 $) from North Dakota . So Mass had three time the impact on national growth.
With a 7,6% growth rate its real GDP increased from 0.24% to 0.26% of the national total.
ReplyDeleteOf course, GDP is a nonsense number. North Dakota is experience real growth -- capital growth. Massachusetts is just spending more.
The BEA reported today that U.S. real GDP by state grew 1.5% in 2011 after a 3.1% increase in 2010....
ReplyDeleteNo, the real GDP was negative. The BLS keeps reporting much lower inflation than has been experienced and the numbers look better than they were. But no serious investor believes the BLS any longer. Which is why selling pressure is so high and why the markets are in trouble without another QE or a similar operation.
The BLS is not involved here, it's the BEA that reports GDP.
ReplyDeleteAs I have reported previously, North Dakota's economic success goes beyond its well-publicized energy prosperity, which is being supplemented by other booming sectors including manufacturing, tourism, advanced manufacturing, information technology and agriculture. The state's pro-business climate should get some of the credit for the impressive output and job gains over the last several years, including leading the country in real GDP growth in 2011. Whatever North Dakota is doing, it's working, and the state should be a nationwide model for economic development and job growth - call it the "Dakota Model."
ReplyDeleteI call it the capital destruction model. Throw billions into producing a product that you sell for half its cost while you hire lots of people and pay a bundle in taxes. Spin the story of a new era that you have to be sophisticated to understand and you get a typical bubble that will destroy the local economy when it bursts.
Related: The May 2012 cover story in the American Gas and Oil Reporter highlights how soaring oil production in North Dakota is spurring infrastructure growth: "Across North Dakota, demand is off the charts for everything from drilling rigs and pumping units to housing and office space, driven by a blistering pace of activity in the Bakken Shale play."
ReplyDeleteSmells like a supply chain problem to me. That is why costs are higher than expected and why the producers can't make money and have to keep adding debt just to stay in business.
The BLS is not involved here, it's the BEA that reports GDP.
ReplyDeleteWhere does the GDP deflator come from?