Meet the state with America's strongest economy
North Dakota's oil boom has sent its GDP soaring, and it's minting 2,000 millionaires a year. But it also faces tough problems.
There's relatively good news nearly across the board when it comes to America's state-by-state economic growth. A new report from the Bureau of Economic Analysis says every state and the District of Columbia, with the exception of Connecticut, experienced real increases in gross domestic product last year.
Overall U.S. real GDP -- that is, adjusted for inflation -- grew by 2.5% in 2012, after an increase of 1.6% a year earlier. Those gains were led by stronger data from durable goods manufacturing, wholesale trade and the finance and insurance sectors.
But if you're looking for the hottest state economy, go north, young man -- to North Dakota. Fueled by the energy boom, it led the nation with a 13.4% increase in GDP in 2012.
Oil production from the underground the Bakken Formation has dramatically changed North Dakota's economic landscape. According to the office of Gov. Jack Dalrymple, the state has created more than 102,000 nonfarm jobs since 2000, and per-capita personal income also doubled during that period. North Dakota's exports totaled nearly $4.3 billion last year, a 26% increase from 2011.
The Center for Innovation at the University of North Dakota tells the Inquisitr website the state is minting nearly 2,000 new millionaires each year, with much of that new-found wealth coming from oil royalties on land. But North Dakota also faces a series of major challenges from the oil boom, including a strained infrastructure, runaway housing prices and the nation's highest worker death rate.
Second on the list of states with the strongest economies was Texas, with a real GDP growth of 4.8%, followed by Oregon at 3.9%.
And what of that laggard Connecticut and its negative (-0.1%) GDP last year? Analysts say unlike the rest of the country, the Nutmeg State's financial services and insurance sectors -- along with weak real estate and austerity in government programs -- were a drag on the regional economy.
"One of the things that Connecticut has done, which is showing up in these numbers, is shrink the size of government faster than just about every other state," Governor Dannel Malloy was quoted in the Hartford Courant. "That is not generally understood. So that has a negative impact [on the economy] and specifically had a negative impact in 2012."
But Don Klepper-Smith, an economist with DataCore Partners in New Haven, told the newspaper that Connecticut's economic issues go beyond a smaller government sector. "Our economic development policies and tax policies, while well-intentioned, are not serving us well."
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