Which city is growing the fastest?

The answer may surprise you. Increases in the services, trade and durable goods sectors are helping to strengthen local economies.

By Bruce Kennedy Feb 26, 2013 8:06AM

Credit: Lester Lefkowitz/Getty Images
Caption: Cranes in Houston, TexasThe majority of American cities saw economic growth in 2011, due largely to increases in business services and manufacturing and stronger trade activity.

The U.S. Bureau of Economic Analysis says real gross domestic product -- that is, GDP adjusted for inflation -- increased in two-thirds of the nation's 366 metropolitan areas in 2011.

Houston's economy grew the fastest out of the nation's largest cities that year, according to The Houston Chronicle.

Here's the bureau's list of the top 10 fastest-growing economies in 2011, along with their economic growth from 2010.

These 10 metro areas also accounted for more than 38% of the overall U.S. metropolitan GDP:

  1. Houston-Sugar Land-Baytown, Texas, up 3.7% from 2010.

  2. Dallas-Fort Worth-Arlington, Texas, up 3.1%

  3. San Francisco-Oakland-Fremont, Calif., up 2.6%

  4. Boston-Cambridge-Quincy, Mass., up 2.4%

  5. Atlanta-Sandy Springs-Marietta, Ga., up 2.2%

  6. Los Angeles-Long Beach-Santa Ana, Calif., up 1.7%

  7. Chicago-Joliet-Naperville, Ill.- Ind.-Wis., up 1.4%

  8. Washington-Arlington-Alexandria, D.C.-Va.-Md.-W.Va., up 1.1%

  9. Philadelphia-Camden-Wilmington, Pa.-N.J.-Del., up 1%

  10. New York-Northern N.J.- Long Island, N.Y.-N.J.-Pa., up 0.8%

As for the different business sectors, cities in New England and the West were most positively affected by growing professional and business services.

Durable-goods manufacturing was important nationally. But the report says it was especially beneficial in the Great Lakes states, where durable-goods accounted for substantial growth in smaller cities like Kokomo, Ind., and Columbus, Ind.

And the effects of wholesale and retail trade gave a boost to the U.S. Southwest -- helping out cities like Odessa, Texas -- where trade added 2.75% to overall real economic growth there.

But there were exceptions all over the map. After two years of economic decline, the Sioux Falls, S.D., metro area had a .09% GDP growth in 2011, thanks in part to a slight rise in local sales, construction, trade and financial services data.

Those modest increases are “all signs that things are happening,” retired University of South Dakota economics professor Ralph Brown told The Argus Leader. “I think (the numbers) look better today than they did say a year, year-and-a-half ago in 2011.”

But Brown says consumers are remaining cautious in his region due to slower than expected economic growth. “Typically, when you have a deep recession, the economy rebounds pretty quickly,” he notes. “The consumer is still trying to deleverage, trying to get its balance sheet back in shape.”

More on moneyNOW

Feb 26, 2013 12:22PM
What percentage of that growth is actually "legal"?
Feb 26, 2013 3:16PM
Philadelphia up 1%? In what, aside from Tastykake(?), Kraft and the shipyard?  I hope that doesn't count the casinos, as most of the jobs are in low wage services. Not real growth.
Feb 26, 2013 2:44PM
Obamaville is growing most quickly of all but nobody wants to admit it.
Mar 7, 2013 12:00AM
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