Real U.S. GDP by metropolitan area declined 2.4 percent in 2009 after declining 0.4 percent in 2008, according to new statistics released today by the U.S. Bureau of Economic Analysis.¹ The economic decline was widespread as real GDP declined in 292 of 366 (80 percent) metropolitan statistical areas, led by national declines in durable-goods manufacturing, construction, and professional and business services.

The decline in durable-goods manufacturing hit the metropolitan areas of the Great Lakes region particularly hard. Kokomo, IN; Elkhart-Goshen, IN; Columbus, IN; and Holland-Grand Haven, MI had double-digit declines in real GDP growth primarily due to declines in durable-goods manufacturing. In the three Indiana metropolitan areas, durable-goods manufacturing subtracted more than ten percentage points from real GDP growth.

The continued decline in construction over the past few years adversely affected metropolitan areas in the Rocky Mountain, Southwest, Southeast, and Far West regions the most. Declines in construction continued in 2009 in places like Lake Havasu-Kingman, AZ; St. George, UT; Prescott, AZ; Naples-Marco Island, FL; and Cape Coral-Fort Myers, FL. In Las Vegas-Paradise, NV construction turned sharply downward in 2009. In all of these metropolitan areas, construction subtracted more than two percentage points from real GDP growth in 2009.

The effects of the decline in professional and business services was more widespread. In St. Louis, MO-IL; Detroit-Warren-Livonia, MI; and Boulder, CO professional and business services subtracted more than two percentage points from real GDP growth in 2009. All of these metropolitan areas declined by more than the national average.

In contrast to most industries, natural resources and mining was a strong positive contributor to growth in 2009. Significant growth in mining resulted from sharp declines in prices for petroleum, natural gas, and other mining products. Growth accelerated in 70 metropolitan areas, most notably in areas where natural resources and mining industries are concentrated such as Casper, WY and Oklahoma City, OK. Casper, WY had the fastest real GDP growth (22.4 percent) of any metropolitan area in 2009 due largely to growth in the mining sector. The natural resources and mining industry contributed more than ten percentage points to growth in several areas such as Casper, WY; Oklahoma City, OK; and Shreveport-Bossier City, LA. In addition to natural resources and mining, several metropolitan areas with large concentrations in nondurable-goods manufacturing—Pascagoula, MS; Vallejo-Fairfield, CA; and Lake Charles, LA—grew significantly in 2009.

Tables 1-4 [XLS] show these results in more detail; complete detail is available on BEA's Web site at www.bea.gov.

Advance Statistics of GDP by Metropolitan Area for 2009 by NAICS Sector

The advance statistics of GDP by metropolitan area for 2009 are based on a more limited set of source data and an abbreviated estimation methodology compared with the standard set of data and the estimation methodology used to prepare the revised NAICS statistics for 2001–2008. The advance GDP-by-metropolitan-area statistics are based primarily on preliminary earnings-by-industry data from BEA's regional economic accounts, released August 9, 2010, and on advance GDP-by-state data released today.

More information on the methodology used to produce the advance 2009 statistics, on the revised GDP-by-metropolitan-area statistics for 2001–2008, and on revisions to the GDP-by-metropolitan-area statistics will appear in an article in the March 2011 issue of the Survey of Current Business, BEA's monthly journal.

Explanatory Notes

Definitions. GDP by metropolitan area is the sub-state counterpart of the nation's GDP, the Bureau's featured and most comprehensive measure of U.S. economic activity. GDP by metropolitan area is derived as the sum of the GDP originating in all the industries in the metropolitan area.

The statistics of real GDP by metropolitan area are prepared in chained (2005) dollars. Real GDP by metropolitan area is an inflation-adjusted measure of each area's gross product that is based on national prices for the goods and services produced within the metropolitan area. The statistics of real GDP by metropolitan area and of quantity indexes with a base year of 2005 were derived by applying national chain-type price indexes to the current-dollar GDP-by-metropolitan-area values for the 61 detailed NAICS-based industries.

The chain-type index formula that is used in the national accounts is then used to calculate the values of total real GDP by metropolitan area and of real GDP by metropolitan area at more aggregated industry levels. Real GDP by metropolitan area may reflect a substantial volume of output that is sold to other areas and countries. To the extent that a metropolitan areas output is produced and sold in national markets at relatively uniform prices (or sold locally at national prices), real GDP by metropolitan area captures the differences across metropolitan areas that reflect the relative differences in the mix of goods and services that the areas produce. However, real GDP by metropolitan area does not capture geographic differences in the prices of goods and services that are produced and sold locally.

Relation of GDP by metropolitan area real growth rates to national GDP. The U.S. metropolitan area growth rates of real GDP may differ from national real GDP growth rates released in July 2010 and the U.S. growth rates of real GDP by state released today. U.S. metropolitan area real GDP growth may differ from U.S. GDP by state growth due to the exclusion of non-metropolitan areas. Differences with the national growth in real GDP are primarily due to the direct linkage and consistency of GDP-by-metropolitan-area statistics with the most recently released statistics of GDP by state and GDP by industry. The GDP-by-industry statistics released December 14, 2010 and the GDP-by-state statistics released today are based upon national real GDP statistics released in July 2010 and have not yet incorporated revisions to national GDP released since.

Metropolitan (statistical) areas. The metropolitan (statistical) areas used by BEA for its entire series of GDP statistics are the county-based definitions developed by the Office of Management and Budget (OMB) for federal statistical purposes and last updated in December 2009. OMB's general concept of a metropolitan area is that of a geographic area consisting of a large population nucleus together with adjacent communities having a high degree of economic and social integration with the nucleus.

The statistics of GDP by metropolitan area in current and real (chained) dollars are available from the Regional Economic Accounts page of the BEA Web site at /regional/index.htm.

The next release of GDP by metropolitan area is scheduled for September 13, 2011. This release will include advance 2010 and revised 2007–2009 statistics.

BEA's national, international, regional, and industry statistics; the Survey of Current Business; and BEA news releases are available without charge on BEA's Web site at www.bea.gov. By visiting the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements.

Footnotes

1. The growth rates may differ from the national rates of GDP growth. See the "Explanatory Notes" for a detailed description.