Ten States With the Fastest Growing Economies
3. West Virginia
> GDP growth: 5.1%
> 2013 GDP: $74.0 billion (12th lowest)
> 1-yr. population change: -0.1% (the lowest)
> 2013 unemployment: 6.5% (18th lowest)
After shrinking by 1.4% in 2012, West Virginia’s economy grew by 5.1% last year, more than all but two other states. While West Virginia is well-known as one of the nation’s largest coal miners, the state is also a burgeoning source of natural gas. According to a report by the Bureau of Business & Economic Research at West Virginia University, the state’s coal production is expected to decline in the coming years, while natural gas production has risen dramatically and is expected to continue to grow. However, outside the mining sector, the state had little in the way of growth. Last year’s 5.1% rise in GDP was driven largely by the mining sector, which added 5.5 percentage points to GDP growth, meaning, on balance, the state actually contracted outside the sector. By one measure, West Virginia is among the poorest states in the nation. The median household income in the state was just $40,196 in 2012, lower than in all but two other states.
> GDP growth: 7.6%
> 2013 GDP: $45.4 billion (2nd lowest)
> 1-yr. population change: 1.0% (11th highest)
> 2013 unemployment: 4.6% (6th lowest)
Wyoming’s economy grew by 7.6% in 2013, just one year after its economy experienced the worst contraction in the nation. The fact that growth rates in Wyoming may be somewhat volatile should not come as a surprise. The state was the nation’s least populous last year, with slightly less than 583,000 residents.. Additionally, the state is highly dependent on the fortunes of the mining sector. Last year, 37% of Wyoming’s total output came from mining, the most of any state. The state’s budget is also highly dependent on taxes from resource extraction. Mining alone accounted for 6.2 percentage points of the state’s 7.6% growth in 2013. Wyoming leads the U.S. in coal production, and all eight of the nation’s largest mines are in Wyoming’s Powder River Basin, according to the EIA. Wyoming is also among the largest states for natural gas production.
1. North Dakota
> GDP growth: 9.7%
> 2013 GDP: $56.3 billion (5th lowest)
> 1-yr. population change: 3.1% (the highest)
> 2013 unemployment: 2.9% (the lowest)
North Dakota has been the fastest growing state in the nation every year since 2010. In fact, the state’s GDP grew by 9.7% last year after it already grew by a stratospheric 20% in 2012 alone. The state’s oil boom, driven by hydraulic fracturing — or fracking — in the Bakken shale formation, has been responsible for much of this growth. Last year, mining directly contributed 3.6 percentage points to the state’s growth rate. Other growing industries, such as real estate and construction, have also contributed to the state’s growth. State residents have benefited from this growth. The state’s unemployment rate as of last year was just 2.9%, the lowest in the nation, while home prices were up nearly 28% over the past five years, also better than any other state.