The Kenan Institute of Private Enterprise at the University of North Carolina ranks our country’s 50 largest cities by economic growth rates. The 50 extended metropolitan areas surveyed all have populations of at least 1.3 million and together include 65% of the American population, but they produce 72% of all American economic activity. Who says city slickers are slackers?
The Kenan Institute says it is trying to measure local gross domestic product in real time; the report was published in October, so we can guess that the report attempts to give local GDP for the third quarter of this year. The Bureau of Economic Analysis estimated last month that national GDP growth in Q3 was 2.6%. Only seven cities on the Kenan Institute’s list beat that figure, suggesting that Kenan’s methodology runs a little hotter than the BEA’s:
- San Francisco Bay Area, CA: 4.8%
- Austin, TX: 4.3%
- Seattle, WA: 3.5%
- Raleigh and Durham, NC: 3.4%
- Dallas, TX: 3.1%
- Denver, CO: 3.0%
- Salt Lake City, UT: 2.8%
44 of the 50 biggest metros show GDP growing. Two—Greensboro, NC, and St. Louis, MO—are flat, while four are shrinking a little:
- Detroit, MI: –0.1%
- Memphis, TN: –0.4%
- Virginia Beach, VA: –0.4%
- Milwaukee, WI: –0.5%
Showing most cities growing is an improvement from Q2, when the BEA says 40 states and D.C. saw shrinking GDP. The Kenan Institute contends that technical recession does not constitute a “significant slowdown” because the labor market has remained strong.
Memo to Curt Soehl: in its summary of the reasons for growth in the ten hottest GDP towns, the Kenan Institute doesn’t mention agriculture. The growth drivers are information technology, biotech, healthcare, clean energy, and financial services. Tourism puts Orlando and New Orleans in Kenan’s top 10, but that could be a temporary artifact of the post-pandemic return of travelers, not a permanent recipe for exceptional GDP growth.