Arkansas GDP up 2.3% in 2010

Arkansas’ 2010 GDP increased to $91.828 billion, up 2.3% compared to 2009, according to a report released Tuesday morning (June 7) by the federal Bureau of Economic Analysis.

Major Arkansas economic sectors showing the best gains in 2010 were, somewhat surprising, durable goods manufacturing (up 0.68%) and non-durable goods manufacturing (up 0.53%). The third best showing was retail, up 0.42%.

The 2010 GDP for Oklahoma was $133.464 billion, up 1% compared to 2009.

However, the 2009 GDP for Arkansas was revised downward from a 0.6% gain to a 1.5% loss. During the previous four years, Arkansas’ GDP has moved from 0.7% increase in 2007, down 0.1% in 2008, down 1.5% in 2009 and now at an estimated 2.3% gain for 2010.

“Real gross domestic product (GDP) increased in 48 states and the District of
Columbia in 2010,” the BEA report noted. “Durable-goods manufacturing, retail
trade, and finance and insurance were leading contributors to the upturn in U.S. economic growth. U.S. real GDP by state grew 2.6 percent in 2010 after declining 2.5 percent in 2009.”

Real GDP by state is an inflation–adjusted measure of each state’s production, wherever sold, according to the BEA.

Arkansas ranked 24th in terms of GDP percentage gain, and Oklahoma ranked 47th. The top five states in terms of percentage gain were:
• North Dakota: 7.1%;
• New York: 5.1%;
• Indiana: 4.6%;
• Massachusetts: 4.2%; and,
• West Virginia: 4%

Arkansas’ key sectors posted the following GDP results in 2010 compared to 2009.
• Agriculture, forestry, fishing & hunting: down 0.07%
• Mining: down 0.06%
• Utilities: up 0.05%
• Construction: down 0.13%
• Durable-goods manufacturing: up 0.68%
• Nondurable-goods manufacturing: up 0.53%
• Retail trade: up 0.42%
• Transportation & warehousing: up 0.08%
• Information: down 0.5%
• Finance & insurance: up 0.06%
• Real estate, rental, leasing: up 0.09%
• Health care and social assistance: up 0.19%
• Arts & entertainment, recreation: up 0.01%
• Accommodation and food services: up 0.06%
• Government: up 0.12%

Michael Pakko, chief economist and state economic forecaster with the Institute for Economic Advancement at the University of Arkansas at Little Rock, predicted in November an Arkansas 2% GDP gain in 2010 and a 3% GDP gain in 2011 “as we move further away” from the recession.

The BEA report included the following observations on key U.S. sectors.
• Durable-goods manufacturing led the recovery in U.S. real GDP by state in 2010; it was the leading contributor to real GDP growth in seven of the eight BEA regions and in 29 states.

• Retail trade and finance and insurance were also leading contributors to real GDP
growth. Retail trade contributed to growth in all eight BEA regions and in every state.

• Although mining was not an important contributor to real GDP growth for the
nation, it was a large contributor in several states. In North Dakota, the fastest growing state in 2010, mining contributed nearly two percentage points to real GDP growth of 7.1%.

• In contrast to other industries, construction continued to be a drag on real GDP
growth. Nationally, construction declined for the sixth consecutive year and detracted from growth in most states. Nevada was particularly hard hit — construction subtracted nearly two percentage points from the state’s real GDP growth.