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Florida GDP outpacing U.S. economic output thanks to strong real estate, construction sectors

Much like the millions of lights in this image of Florida from space, the Sunshine State's GDP has been humming along. 

Image Credit: NASA

Much like the millions of lights in this image of Florida from space, the Sunshine State's GDP has been humming along. Image Credit: NASA

Florida's GDP growth of 2.1 percent in the first quarter of 2016 not only outpaced the country as a whole, but all of the other top population states and every state in the Southeast but one.

Not a bad economic scorecard for the Sunshine State. A key measure of economic vitality, gross domestic product (GDP) by state is the market value of goods and services produced by the labor and property located in a state.

In the first quarter, the value of Florida's GDP stood at more than $911 billion, up more than $48 billion from a year earlier.

Florida ranked 10th for GDP growth among all states in the first quarter, according to the latest U.S. Commerce Department numbers out Wednesday. The state's GDP was most recently driven by gains in Florida's classic industries: real estate, construction and retail.

At No. 10, Florida's GDP in the first quarter easily outgrew its biggest peers — California at No. 13, Texas at No. 35 and New York at No. 30. Among southeastern states, Florida GDP outgrew all of them except for Arkansas, whose quarterly economic performance landed it at No. 1 among all states with a 3.9 percent GDP growth rate.

What specifically fueled Florida's latest 2.1 percent GDP? Growth in real estate and construction industry output made up half of its gains in the quarter. Those two sectors were followed by retail, health care and financial services.

Florida industries whose output actually fell in the quarter ranged from entertainment, accommodation and food services (yes, tourism is part of all that), along with transportation and warehousing, and utilities.

North Dakota, whose earlier heyday as a fracking capital and job generator appear to be over for now, ranked last at No. 50 among states. Its GDP fell a striking 11.4 percent in the first quarter.

GDP gains were reported by 37 states and the District of Columbia while 12 states reported GDP declines. Nevada was flat.

Nationally, U.S. GDP growth has remained positive but slow. U.S. GDP growth averaged 2.4 percent in 2015 but only 1.2 percent in the first quarter of 2016. Such modest growth rates appear likely for awhile.

"Pessimists have called this current post-recession economy 'the new normal'," commented Bloomberg News on Wednesday:

Florida's overall GDP growth in 2015 was 3.1 percent, spiking at 5.6 percent in the third quarter of last year. It started 2015 in its first quarter at only 1.8 percent.

Economic momentum suggests Florida may continue to grow faster than the nation as a whole for the foreseeable future. In addition to a steady pipeline of new residents now moving to Florida, the state continues to enjoy strong job creation. Minnesota software firm Sagitec Solutions last week said it will expand and add 60 jobs to the Tampa market.

This week, ADP announced plans for 1,600 new jobs in the Orlando area. And Amazon — already a job powerhouse in the Ruskin area south of Tampa — on Wednesday said it will expand its warehouse/distribution empire in Florida to Jacksonville and hire 1,500.

It's not up, up, up all the time. In Tampa, call center firm Convergys this week said it would cut 375 area jobs to reflect a drop in demand for its services.

Contact Robert Trigaux at rtrigaux@tampabay.com. Follow @venturetampabay.

Florida GDP outpacing U.S. economic output thanks to strong real estate, construction sectors 07/27/16 [Last modified: Wednesday, July 27, 2016 8:52pm]
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