Cities With the Fastest Growing (and Shrinking) Economies

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The Fastest Shrinking Metropolitan Economies

10. Pine Bluff, AR
> 2014 GDP growth:
-3.1%
> 2014 GDP: $2.77 billion
> Largest industry: Government
> Largest industry’s share of GDP: 22.5%

The national economy grew by 2.2% last year, but the growth was not uniform across the country. The Pine Bluff metro region’s economy shrank by 3.0%, the 10th largest economic contraction of the 381 U.S. metro areas. As in six other metro areas with the fastest-shrinking economies, the natural resources and mining industry in Pine Bluff contributed the most to the economic contraction, contributing roughly 1 percentage point to the area’s economic decline.

A weak economy often has a tangible impact on area residents. The Pine Bluff metro area had one of the nation’s highest unemployment rates of 8.6% in 2014. Also, more than 26% of people lived in poverty, the 11th highest poverty rate in the nation.

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9. Champaign-Urbana, IL
> 2014 GDP growth:
-3.1%
> 2014 GDP: $9.38 billion
> Largest industry: Government
> Largest industry’s share of GDP: 27.6%

Three of the 10 hardest hit urban economies in 2014 are located in Illinois — and Champaign-Urbana is one of them. Unlike most of the of the other cities with the fastest shrinking economies, the percentage of adults with at least a bachelor’s degree in the Champaign area far exceeded the corresponding national rate. While slightly more than 30% of adults nationwide had a bachelor’s degree, nearly 39% of adults in Champaign had at least that level of education. However, higher educational attainment did not make the metro area recession-proof. Government and mining were the biggest drags on the local economy, detracting 0.8 and 2.7 percentage points, respectively, from local economic growth — the city’s economy shrank by 3.1% in 2014.

8. Fayetteville, NC
> 2014 GDP growth:
-3.2%
> 2014 GDP: $15.89 billion
> Largest industry: Government
> Largest industry’s share of GDP: 52.8%

Government comprises more than half, or 52.8%, of Fayetteville’s total GDP, the fourth highest concentration of government in any metropolitan economy. However, the government sector shrank by 2.0% last year, one of the largest declines of U.S. metro area government sectors. Fayetteville is home to the country’s most populous army base, Fort Bragg, which accounts for a significant portion of the area’s government GDP contribution. As a result, Fayetteville’s economy can fluctuate alongside national defense budgets. Other prominent industries in Fayetteville are manufacturing and –grouped as one sector– finance, insurance, real estate, rental, and leasing, which both composed about one-tenth of GDP.

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7. Rocky Mount, NC
> 2014 GDP growth:
-3.2%
> 2014 GDP: $5.56 billion
> Largest industry: Manufacturing
> Largest industry’s share of GDP: 41.6%

Manufacturing comprises 41.6% of Rocky Mount’s economy, the fifth highest concentration of that sector in any area. When a metropolitan area’s economy is concentrated in a single industry, the area’s fortunes are highly tied to that of the industry’s. In Rocky Mount, the manufacturing sector shrank by 5.0%, one of the larger contractions of that industry in a metro area. This industry’s downturn accounted for 2.1 percentage points of Rocky Mount’s 3.2% GDP drop, the second largest drag on a metropolitan area’s economy by manufacturing. In the rest of the country, manufacturing made up 12.2% of total GDP and grew 3.3%. Despite its shrinking economy, Rocky Mount’s unemployment rate dropped 2.6 percentage points from 11.2% in 2013 to 8.6% in 2014, the second largest drop in unemployment rate in country.

6. Bloomington, IL
> 2014 GDP growth:
-3.3%
> 2014 GDP: $10.19 billion
> Largest industry: Finance, insurance, real estate, rental, and leasing
> Largest industry’s share of GDP: 34.7%

While finance, insurance, real estate, rental, and leasing was Bloomington’s largest industry by GDP contribution, it was also one of the city’s fastest shrinking industries last year, contracting by 3.3%. Consequently, with the exception of mining, no industry did more damage to total GDP in the metro area. Finance, insurance, real estate, rental, and leasing reduced Bloomington’s economic output by roughly 1.2 percentage points. Despite the bad year of economic growth, the 5.6% unemployment rate in Bloomington was lower than the national unemployment rate in 2014.