Lehigh Valley GDP Continues to Grow; Reaches Record-High $39 Billion
By Colin McEvoy on September 21, 2017
The Lehigh Valley’s gross domestic product (GDP) for private sector industry has grown to a record-high $39.1 billion for 2016, a more than 4 percent increase over the previous year.
The regional GDP saw year-over-year growth in each individual subsector, reflecting the remarkable balance of the Lehigh Valley economy.
“It’s truly remarkable to consider that the economic output of our two counties has increased to the point that it’s larger than two states,” said Don Cunningham, President and CEO of the Lehigh Valley Economic Development Corporation (LVEDC). “We saw growth across each of our economic subsectors, and manufacturing continues to grow in the Lehigh Valley, making up an even larger percentage of the regional economy than last year.”
The findings released today by the U.S. Department of Commerce’s Bureau of Economic Analysis (BEA) show that the Lehigh Valley economy now ranks 65th out of the 382 largest metropolitan areas in the United States, compared to ranking 73rd last year.
The Lehigh Valley GDP is now larger than that of Wyoming ($38.5 billion) and Vermont ($31.5 billion), as well as 108 other countries in the world. If the Lehigh Valley were a country, it would be the 87th largest in the world in terms of economic output.
Finance, insurance, and real estate is once again the region’s largest sector in terms of GDP, having reached $8 billion, or roughly 20 percent of the total economy. This was previously the region’s largest sector in 2014, before it was overtaken by manufacturing the next year.
Manufacturing, which is the region’s second-largest sector, also saw growth over the previous year. It is now $6.9 billion, or nearly 18 percent of the total regional GDP. Last year, manufacturing only accounted for 15 percent of the GDP.
“These new numbers really reflect the growth we’ve been seeing in the professional office and business services sector here in the Lehigh Valley, which brings with it higher-paying jobs and an increased quality of life,” Cunningham said. “They also speak the incredible economic growth we’ve experienced in the Lehigh Valley, as well as the unusual balance between our various economic sectors, a sign of a well-balanced and multifaceted economy.”
A breakdown of the total GDP by subsector, as well as the rate of year-over-year growth, can be found below:
- Finance, insurance, and real estate: $8 billion (+5.9 percent)
- Manufacturing: $6.9 billion (+2.6 percent)
- Education and health care: $5.3 billion (+4.6 percent)
- Professional and business services: $5.3 billion (+4.2 percent)
- Retail trade: $2.3 billion (+3.2 percent)
- Information: $1.9 billion (+1.6 percent)
- Transportation and warehousing: $1.9 billion (+9.5 percent)
- Arts, accommodation, and food services: $1.6 billion (+5.4 percent)
Manufacturing year-over-year growth was led by a 4.5 percent increase in non-durable goods manufacturing. This includes food and beverage and chemical products, which reflects two of the target sectors of the Lehigh Valley (food & beverage processing and life science research & manufacturing) as identified by LVEDC.
Transportation and warehousing is the fastest-growing sector of the regional economy, according to the BEA, with 9.5 percent growth year-over-year.
Goods-producing industries in the Lehigh Valley economy increased by 3.4 percent, according to the BEA, while service-producing industries increased by 4.4 percent.
These GDP figures derive from the BEA and were analyzed and presented by George Lewis, LVEDC Director of Research and Analysis. GDP rankings of other countries come from the World Bank. The BEA adjusts its figures to account for new information and projections, so numbers that have been reported for previous years may have been changed or adjusted over time.
2016 is the most recent year for which measurable GDP data is available. The $39.1 billion GDP figure does not account for government spending.
Don Cunningham: New Generations Drive New Economies
This column, written by LVEDC President and CEO Don Cunningham, originally appeared in The Morning Call and on the newspaper's website on September 13, 2017. (Click here t[...]Continue to Next Page