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What lurks behind the Tampa Bay area's GDP stats

 
$60,038
$60,038
Published Sept. 22, 2014

At first glance, Tampa Bay's $115 billion gross domestic product, a measure of this metro area's economic output of goods and services last year, seems quite respectable, growing 2.3 percent in 2013. After all, the nation's 300-plus metro areas combined averaged just 1.7 percent growth.

Based on that comparison alone, we should cheer our economic competitiveness, right?

Hold the applause.

Let's not fool ourselves.

We're slipping behind.

So say the numbers released in recent days by the U.S. Department of Commerce's Bureau of Economic Analysis.

It's only when we take a closer look that the cracks in this metro area's GDP start to show.

Measured per person, Tampa Bay's GDP badly lags many key metro areas that routinely are considered direct competitors or have similar GDP numbers.

Last year, Tampa Bay's GDP per person averaged $40,153. That number comes from dividing the $115 billion GDP by the number of people, just over 2.8 million, who live in this metro area.

Compare that with Orlando, whose smaller overall GDP of $104 billion is divided by its smaller population to yield $45,855 per person.

Now, $5,000-plus per person is a big difference. It says the Orlando metro area's economy is more potent and more productive, given the number of people who live there, than Tampa Bay's.

Look at this another way: Two metro areas that boast very similar total GDP figures in 2013 to Tampa Bay's $115 billion are Indianapolis ($117 billion) and Cleveland ($114 billion).

The difference is that Indianapolis and Cleveland achieved their GDP sizes with smaller populations.

Per person, the GDP disparity is striking:

• Indianapolis: $60,038. That's 50 percent more per person than in Tampa Bay.

• Cleveland: $55,430. That's 38 percent more per person than in Tampa Bay.

Also, the pace of Tampa Bay's GDP isn't improving much over time. Over a dozen years, from 2001 to 2013, Tampa Bay's GDP per person rose a mere 3.1 percent. (Notably, Orlando's per-person GDP actually fell 4 percent in that same period but still remains bigger than Tampa Bay's.) Meanwhile, Indianapolis enjoyed a 5.2 percent bump, and Cleveland soared by 12 percent in the same period.

These are not subtle differences. They represent startling gaps in the quality of regional economic output.

• • •

Let's not confuse this discussion of disparity of GDP per person with the recent and related news of Tampa Bay's lagging household income.

As Tampa Bay Times business writer Jeff Harrington recently reported, the median household income in Tampa Bay sank to lower than it was after the recession ended three years ago. That decline makes the bay area's the lowest in household incomes among the country's 25 biggest metros.

Economic experts put most of the blame on Tampa Bay's heavy dependence on the low-income jobs added in the past five years, especially tourism and retail work.

The sobering Census Bureau statistics on household income, Harrington wrote, paint a grim reality: "Despite a significant drop in unemployment, Tampa Bay's economy has largely been treading water since 2010, making little progress to shore up the finances of working families."

• • •

Now let's combine these troubling trends.

Tampa Bay's economic output per person badly lags its peers'. And its median household income trails those of two dozen larger metro areas. That's hardly a recipe for a dynamic future.

Why does this metro area suffer such weak numbers? Here are five likely reasons.

1. The recent obsession with reporting record tourism numbers feels good in these harder times but also reminds us that the jobs being created in bulk — and that helped drive down the unemployment rate — tend to be lower-wage opportunities.

2. The severity of Florida's recession discouraged much of the earlier economic development efforts to pursue higher-wage jobs in manufacturing and biotech. The once-common pitch by economic leaders describing Florida tourism and agriculture as the state's industries of yesterday is rarely heard these days.

3. Gov. Rick Scott's administration and Tampa Bay officials have done little to revive policies to attract higher-wage, higher-skill jobs at a time when any job is still considered a plus — especially in an election year.

4. Tampa Bay's tri-city metro structure — split among Tampa, St. Petersburg and Clearwater — remains inefficient and tends to impede larger-scale economic initiatives that could benefit the region as a whole.

5. While this metro area remains economically diverse, it boasts few significant corporate headquarters. Only three of Florida's 14 Fortune 500 companies are based in the Tampa Bay metro area and are split among the three larger cities. None of the three ranks among the Fortune 100, and none shows a propensity to serve as significant regional leaders in the economy.

Given such dour trends, Tampa Bay may want to remove the rose-colored glasses long enough to rethink how to get back in the economic game. It's a game that's certainly not going to get any easier in the years to come.

Contact Robert Trigaux at rtrigaux@tampabay.com or (727) 893-8405. Follow @venturetampabay.