States With the Fastest (and Slowest) Growing Economies

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1. North Dakota
> GDP growth:
6.3%
> 2014 GDP: $48.2 billion (5th smallest)
> 1-yr. population change: 2.2%(the largest)
> 2014 unemployment: 2.8% (the lowest)

North Dakota’s economy grew by 6.3% last year, the largest state GDP growth in the nation and far higher than the U.S. growth rate of 2.2%. Energy production, which is part of the mining sector, has been a major contributing factor to the state’s economic growth. The state produced 1,406 trillion BTUs of crude oil in 2012, the second highest production level in the country after Texas. The mining sector accounted for 2.47 percentage points of the state’s overall growth rate. This was also the third highest such contribution from the sector nationwide.

With the largest one-year population growth of any state, at 2.2%, people are still flocking to North Dakota. The state’s housing market is also doing well. The real estate, rental, and leasing sector contributed another 0.76 percentage points to economic growth, the highest contribution from that sector compared to other states. North Dakota’s strong economy has likely helped attract workers looking for job opportunities. North Dakota’s unemployment rate was 2.8% in 2014, far lower than the national unemployment rate of 6.2%. North Dakota’s economic future is far more uncertain than it seems, however. In May, the state had the second-largest over-the-month decrease in employment, with a net loss of 5,300 jobs.

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2. Texas
> GDP growth:
5.2%
> 2014 GDP: $1.5 billion (2nd largest)
> 1-yr. population change: 1.7% (3rd largest)
> 2014 unemployment: 5.1% (16th lowest)

Texas’s economy grew by 5.2%, more than double the U.S. growth rate of 2.2%. Like several other state economies growing the fastest, Texas’s economic growth was driven primarily by the mining sector, which contributed 1.25 percentage points to the state’s overall growth rate, tied for the fifth largest such contribution nationwide. Energy production and the availability of natural resources are major factors in the mining sector. In 2012, the state produced 8,565 trillion BTUs of natural gas, the highest level of all states.

The nondurable goods sector accounted for another 0.84 percentage points of the growth rate, the third highest contribution from that sector nationwide. Texas’s strong economy has likely helped attract workers looking for job opportunities. The state’s population grew 6.8% in the last five years. A strong housing market is another indicator of a strong economy. From 2013 through 2014, housing starts grew by 10.2% in Texas, one of the highest rates in the country. Additionally, housing prices rose 6.6% last year, one of the highest rates nationwide.

3. West Virginia
> GDP growth:
5.1%
> 2014 GDP: $68.0 billion (12th smallest)
> 1-yr. population change: -0.2%(the smallest)
> 2014 unemployment: 6.5% (15th highest)

West Virginia’s economy grew by 5.1%, well above the U.S. growth rate of 2.2%. While the state’s construction and durable goods manufacturing sectors were drags on the economy, the mining sector contributed 5.04 percentage points to the state’s overall growth rate. This was more than enough to make West Virginia the third fastest growing economy in the nation. The state produced 3,059 trillion BTUs of coal and 602 trillion BTUs of natural gas in 2012, the second and ninth highest levels in the country. That year, however, the state’s GDP contracted by 3.4%, the second largest decline at the time. Growing energy activity is a relatively recent development in the state, and the potential social and economic benefits have still not been realized. West Virginia’s unemployment rate of 6.5% was slightly higher than the national unemployment rate. Also, the state’s housing market is not especially strong. Housing starts shrank by 16.8% in 2014, the second largest decline of any state after only Vermont. In addition, the state’s poverty rate of 18.5% was the 10th highest nationwide.

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4. Wyoming
> GDP growth:
5.1%
> 2014 GDP: $37.6 billion (2nd smallest)
> 1-yr. population change: 0.2%(11th smallest)
> 2014 unemployment: 4.3% (8th lowest)

Like in most states with especially fast-growing economies, Wyoming’s economic growth was driven primarily by the mining sector — Wyoming has abundant natural resources, and energy production, too, is part of the mining sector. The state produced 6,974 trillion BTUs of coal in 2012, the highest level in the country. Last year, the mining sector contributed 3.52 percentage points to the state’s overall growth rate, the second largest such contribution nationwide. Other industries also helped GDP growth. The nondurable goods sector contributed 0.66 percentage points to growth, the fourth highest contribution from that sector in the country. A growing economy often leads to more job opportunities. Wyoming’s unemployment rate was 4.3% in 2014, one of the lowest rates nationwide. The housing market, on the other hand, did not show any improvement. Housing starts shrank by 8.8% in 2013, one of the larger declines.

5. Colorado
> GDP growth:
4.7%
> 2014 GDP: $279.7 billion(18th largest)
> 1-yr. population change: 1.6%(4th largest)
> 2014 unemployment: 5.0% (15th lowest)

Colorado’s economy grew by 4.7%, far higher than the U.S. growth rate of 2.2%. As was the case with several of the states with the fastest growing economies, the mining sector contributed disproportionately to growth, contributing 1.25 percentage points to the state’s overall growth rate. The real estate, rental, and leasing sector, which was among the larger industry contributors to national GDP growth in 2014, contributed 0.43 percentage points to growth in Colorado, the third highest contribution from that sector nationwide. Colorado’s strong economy has likely helped attract workers looking for job opportunities. The state’s population grew by 6.1% in the five years through 2014.