What impact has the current economic downturn had on the GDP of the Southern states?
Advance 2008 and Revised 2005‐2007 GDP‐by‐State Statistics
New statistics released on June 2, 2009, by the U.S. Bureau of Economic Analysis show that economic growth slowed in most states and regions of the U.S. in 2008 as economic growth overall slowed. Real GDP growth slowed in 38 states, with downturns in construction, manufacturing, and finance and insurance restraining growth in many states. Growth in real U.S. GDP by state slowed from 2.0 percent in 2007 to 0.7 percent in 2008.1
Real economic growth slowed in all eight BEA regions. As a whole, the SLC states slowed slightly below the national average, with real GDP growth dropping from 1.8 percent in 2007 to 0.6 percent in 2008. Of the SLC states, West Virginia and Oklahoma fared the best during the downturn, with their GDP growing from 0.6 percent in 2007 to 2.5 percent in 2008 and from 1.9 percent in 2007 to 2.7 percent in 2008, respectively. The growth is largely attributable to the growth of the energy sector in these states. Texas has also weathered the storm in relatively stable condition: although GDP growth slowed from 4.4 percent in 2007 to 2.0 percent in 2008, the state still enjoyed an absolute growth in real GDP of over $18 billion, from $907.4 to $925.5 billion in year 2000 chained dollars.
Real GDP by SLC State, 2005-2008
|State||Millions of chained (2000) dollars 1||Percent change|
|United States 2||10,912,180||11,218,785||11,439,232||11,523,637||3.1||2.8||2.0||0.7|
* Advance statistics
1) To compare economic changes over time, current or nominal values of currencies must be deflated or adjusted for inflation. In the United States, BEA establishes indices to calculate changes between years. These are used to calculate real chained dollars. Annual changes in the indices are chained (multiplied) together to form a time series. Chained dollars, instead of merely reflecting inflation, capture the effect of relative changes in prices and in the composition of output. They also better reflect cyclical fluctuations in the economy. Chained 2000 dollars are the most currently available indices from BEA for adjusting for inflation.
2) U.S. real GDP by state for the advance year differs from the corresponding national income and product account (NIPA) value because of differences in source data and methodologies used to estimate the related statistics, and because of revisions to the NIPA values since the previous annual NIPA revision. In addition, U.S. GDP-by-state values differ from the corresponding NIPA values because the U.S. GDP-by-state values exclude Federal military and civilian activity located overseas, which cannot be attributed to a particular state.
|Source: U.S. Bureau of Economic Analysis|
In the nation, twelve states experienced declines in real GDP in 2008. Alaska had the largest decline in real GDP (‐2.0 percent), caused mainly by a decline in petroleum extraction. In Georgia (-0.6 percent), the contraction was mainly due to declines in manufacturing and construction, with finance and insurance also contributing to the decline. Further, Florida experienced faster real growth than average in 2004, 2005, and 2006, but its economy slowed in 2007 and declined in 2008 (-1.6 percent). The main contributors to the economic slowdown in the state were declines in the construction and finance and insurance industries.
In terms of per capita real GDP, Delaware's was the highest in the nation, 49 percent above the national average. Mississippi's per capita real GDP of $24,403 was the lowest in the nation, 36 percent below the national average.
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.
1. U.S. real GDP by state for the advance year differs from the corresponding national income and product account (NIPA) value because of differences in source data and methodologies used to estimate the related statistics, and because of revisions to the NIPA values since the previous annual NIPA revision. In addition, U.S. GDP‐by‐state values differ from the corresponding NIPA values because the U.S. GDP‐by‐state values exclude Federal military and civilian activity located overseas, which cannot be attributed to a particular state.
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