Ohio’s GDP growth among the weakest in the country, per Cleveland Fed report
Cleveland Fed Bank report: Declines in Ohio’s manufacturing and in the financial sector produced a weaker overall gross domestic product starting in late 2021. Ohio's GDP growth has been among the weakest in the country, ranking 45th in the U.S. with less than 1% growth recorded between 2021 and 2023, according to a report by the Cleveland Fed. The report also found that two of Ohio's most prominent industries, manufacturing and the accumulative finance, insurance, and real estate sector, contracted during this period. California, New York, Rhode Island and Mississippi also saw similar results. Despite this, Ohio's arts, entertainment and recreation industry grew the second-largest increase among all states. Ohio's 2.5% GDP growth was compared to the national rate of growth of 4.3% for the country and the 3.1% median across all states from 2020-2022.
Published : 4 weeks ago by Kim Palmer in Finance
Ohio's gross domestic product (GDP) growth ranked 45th in the U.S. with less than 1% (0.5%) growth recorded between the fourth quarter of 2021 and the third quarter of 2023.
Over the same period, GDP for the U.S. grew nearly 3%, the report found.
Economic growth in Ohio was relatively close to the national rate of growth through nearly the first two years of the pandemic, but GDP growth has been noticeably weaker compared to the rest of the country since the end of 2021.
Two of Ohio’s most prominent industries — manufacturing and the accumulative finance, insurance, and real estate sector — contracted during that time, the report found.
Ohio wasn't alone in those declines, as California, New York, Rhode Island and Mississippi saw similar results.
“Manufacturing and (finance, insurance and real estate) tend to be important to explaining GDP growth differences across states, partly because these industries typically account for a fair amount of overall activity, almost a third at the median,” said Guhan Venkatu, senior policy advisor at the Cleveland Fed, in a statement.
The report did find that Ohio's arts, entertainment and recreation industry grew during the 2021-2023 period, constituting the second-largest increase among all states. The industry, however, only makes up about 1% of the state’s total GDP.
Professional services, which makes up 6% of the state GDP, and health care, which constitutes 8.7%, grew 11% and 7.2%, respectively, from the end of 2021 to the third quarter of 2023, according to the report.
The downturn is a departure for the state that saw GDP changes in line with the rest of the country until the end of 2022. Ohio's 2.5% GDP growth was relatively similar to 4.3% for the country and the 3.1% median across all states from 2020-2022.
According to the report’s conclusion, Ohio’s cumulative state growth ranking since early 2021 declined from 31 to 38 by the end of 2021, then down to the current rank of 45.
Topics: Markets, Economy