The 11 States With The Fastest-Growing Economies

The 11 States With The Fastest-Growing Economies

GDP growth: 2%
Real 2011 GDP: $305 billion (14th highest)
Population change: 1.29% (5th highest)
Increase in employment: 1.2% (tied-11th highest)

Washington is tied for eighth place with four other states in the competition for fastest-growing state economy. Its durable goods manufacturing industry expanded significantly, contributing nearly half of the state's total GDP growth.

According to the Bureau of Labor Statistics, Washington's manufacturing sector added about 11,000 jobs in 2011. That growth, a 4.3% increase, represents the nation's sixth-largest proportional increase in the manufacturing sector.

According to Washington's State Department of Commerce, its information sector growth came "from household names such as Microsoft, Amazon, and Real Networks, to emerging companies in the transformative areas of cloud computing virtualization and energy efficiency." 

GDP growth: 2%
Real 2011 GDP: $1.735 trillion (the highest)
Population change: 0.95% (11th highest)
Increase in employment: 0.9% (tied-21st lowest)

With a population of 37.7 million, California has one of the largest economies in the world. By itself, it represents 13.2% of U.S. economic production. Due to its enormous size, the state's 2% GDP increase was worth $33 billion -- the second-largest growth in dollar terms in the U.S. after Texas.

California's growth last year can be credited to expansions in its manufacturing, information, and the professional, scientific, and technical service sectors. The state's durable manufacturing sector, which includes the computer and innovation technology-producing Silicon Valley, contributed more than $10 billion of the GDP increase.

GDP growth: 2%
Real 2011 GDP: $201 billion (24th highest)
Population change: 0.15% (22nd lowest)
Increase in employment: 1.0% (tied-21st highest)

Relative to its labor force, Connecticut has the second-largest finance sector, behind national leader Delaware. That sector was the largest factor in the state's economic expansion, contributing 30% to the state's total GDP growth. Banking, financial services, and insurance job openings increased steadily throughout 2011. The professional, scientific, and technical services sectors also grew.

GDP growth: 2%
Real 2011 GDP: $108 billion (17th lowest)
Population change: 1.5% (2nd highest)
Increase in employment: 2.2% (2nd highest)

Utah flourished despite the recession, and continues to now. As was the pattern across the  country, its major contributors to growth were durable goods manufacturing, information, and the professional, scientific, and technical services sectors.

However, several other sectors had strong positive impacts on Utah's economic growth, a fact that speaks to the state having a healthy, well-rounded economy. From 2010 to 2011, the unemployment rate in the state fell from 8% to 6.7%, well below the national averages for both years.

GDP growth: 2.2%
Real 2011 GDP: $349 billion (12th highest)
Population change: 0.49% (20th lowest)
Increase in employment: 0.6% (tied-14th lowest)

Massachusetts' growth rate of 2.2% is actually down from its 2009-2010 growth rate of 4.4%. Still, there were meaningful improvements in several sectors last year, notably professional, scientific, and technical services, which was responsible for almost 27% of GDP growth. Also a major factor, the durable goods manufacturing sector contributed almost 24% of growth.

GDP growth: 2.3%
Real 2011 GDP: $337 billion (13th highest)
Population change: -0.01% (2nd lowest)
Increase in employment: 1.9% (4th highest)

Michigan added 72,300 jobs in 2011, a 1.9% increase from the previous year. This rate of job growth, one of the healthiest in the country, came primarily from the services and manufacturing sectors, which added more than 30,000 new employees each. This may be due in part to the fact that GM and Chrysler exited Chapter 11 last year

Statewide, unemployment dropped from 12.7%, the second-highest rate in the country, to 10.3%, the seventh-highest. Overall, Michigan's GDP increased by $7.4 billion. Durable goods manufacturing accounted for just over half of this growth.

GDP growth: 2.5%
Real 2011 GDP: $45 billion (7th lowest)
Population change: 1.2% (6th highest)
Increase in employment: 1.1% (tied-15th highest)

The mining industry, which includes  oil, natural gas and mineral extraction, was the leading source of economic growth in Alaska in 2011, generating about $849 million.

The mining and logging industries provide 4.8% of the jobs in Alaska, the second-highest percentage of any state in the country behind Wyoming. Alaska's population increased markedly in 2011,  while unemployment  decreased from 8% in 2010 to 7.6% in 2011.

The harvesting of the state's natural resources returns an annual benefit to every Alaskan: the Permanent Fund Dividend, which gives every resident a portion of the mining proceeds. In 2011, the checks were for $1,174 each.

GDP growth: 3.3%
Real 2011 GDP: $1.150 trillion (2nd highest)
Population change: 1.67% (highest)
Increase in employment: 2.1% (3rd highest)

The GDP of Texas grew by an impressive $36.8 billion, more than the total GDP of five states. Its rapidly growing population helped propel that growth as it surpassed New York to become the second-most populous state.

Its GDP growth can be traced to a number of major industries: Mining contributed about 19%, and manufacturing contributed almost 22%. The unemployment rate fell from 8.2% to 7.9% as the trade, transportation, and utilities companies added 51,100 jobs, and mining companies added 29,800 jobs.

GDP growth: 4.5%
Real 2011 GDP: $56 billion (11th lowest)
Population change: 0.05% (3rd lowest)
Increase in employment: 1.0% (tied-21st highest)

Given that its population increased by less than 1,000 people between 2010 and 2011, West Virginia's 4.5% GDP growth is especially remarkable. The vast majority of this growth -- 86.4%, or more than $2 billion -- was driven by the mining industry. Indeed, mining's boost to West Virginia's economy was the greatest individual contribution to GDP growth of any industry in any state.

The mining and lumber industries provided jobs for 33,600 West Virginians in 2011: 4.5% of all jobs in the state, where the unemployment rate, fell from 8.5% in 2010 to 8.0% in 2011.

GDP growth: 4.7%
Real 2011 GDP: $186 billion (25th highest)
Population change: 0.87% (16th highest)
Increase in employment: 1.0% (tied-21st highest)

Oregon's GDP last year grew nearly three times faster than the U.S. economy overall. The state's durable goods manufacturing industry was the second-fastest growing sector in the nation with a 3.94% growth rate, accounting for almost 20% of Oregon's economic expansion. High tech companies such as Intel, which employs about 16,300 in Portland, dominate the industry.

Some of the growth Oregon is enjoying can be attributed to the reverse offshoring trend: Manufacturing jobs are being brought back to the U.S. as companies respond to product defects, delays, and thefts in their overseas supply chains, as well as other economic factors that make offshoring less cost effective.

GDP growth: 7.6%
Real 2011 GDP: $34 billion (5th lowest)
Population change: 1.38% (3rd highest)
Increase in employment: 4.8% (highest)

From 2010 to 2011, 18,100 net jobs were created in a state with a population just over 680,000. This was three times as many as the 5,600 created over the same period in New Jersey, a state with 8 million residents.

Much of North Dakota's growth has been driven by exploration of the Bakken shale, a geological formation believed to hold billions of barrels worth of recoverable oil. That economic boost echoed in strong job growth in many industries. Jobs in in mining and logging increased by 52.3%, jobs in construction increased 11.1%, and jobs in trade, transport and utilities increased a cumulative 6.5%. All of these were the highest rates of increases in the country.


By Michael B. Sauter and Lisa Nelson, 24/7 Wall St.

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