Skip to content

The American Economy is Becoming Increasingly Concentrated in Certain Regions

The American economy is enjoying a record spell of growth that has lasted for more than a decade. However, a recent report has shown how the growth is concentrated in certain counties and cities.

What the Data Shows

This information comes from the Bureau of Economic Analysis. They put it together by looking at GDP figures from the last 20 years. They looked at these numbers at the county-level to understand where the main growth is coming from.
The overall conclusion is that just 1% of the US’s counties account for an increasingly high amount of growth. This 1% represents 31 counties. Together, they are responsible for over 32% of the GDP recorded by the US in 2018.    
Yet, those 31 counties only contain just under 22% of the country’s population and 26% of the people employed in the US. More importantly, this powerful 1% saw their share of the total GDP rise from 30.1% in 2009 to it’s the current figure.

What Do the Figures Mean?

A look at the 31 counties that are in the top 1% shows that business is booming in the biggest cities and by the coast. The number one spot is occupied by Los Angeles County. It contributed over $395 billion to the American GDP between 2001 and 2018. This gives it a similar GDP to Saudi Arabia.
Next on the list was New York County, which includes Manhattan. This county provided some $340 billion to the nation’s GDP during the period that was analysed.
Overall, the top 1% of counties come from 16 different states as well as the District of Columbia. They include some of the most heavily populated parts of the country, including Texas, Florida and California.
It is also notable that all of the 31 counties with the best growth levels either include major cities in them, or have big cities close to them. This raises the question of whether rural areas are in danger of being left behind.
The total amount of GDP that these top counties contribute is $1.3 trillion more than you would expect according to their number of workers. Some of the biggest names that operate in these places include technology and retail giants Apple, Amazon and Google. 
Another industry that is well-represented is arts and entertainment. Los Angeles has been the leader in this area through the period from 2001 to 2018. However, New York has increasingly been making inroads in this type of business. Among the industries that are now less centralised than before are transportation and warehousing, agriculture and forestry.

Looking Ahead to the Future

The recent decision by the Federal Reserve to leave interest rates unchanged suggests that they are confident that the economy is strong enough to carry on growing. This is despite the concerns over trade wars and the global economic slowdown that have caused international debt recovery to become increasingly important.

It seems likely that the American economy continues to grow stronger in and around the major cities. Yet, the importance of other regions of the US can’t be under-estimated.