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Minnesota had the the 36th fastest growing economy in the United States in the first quarter of 2019

New data from the Bureau of Economic Analysis (BEA) today shows that, in the first quarter of 2019, Minnesota had the 36th fastest growing economy out of the 50 states and District of Columbia. As Figures 1 and 2 shows, our economy grew at 2.6% in real terms, below the national rate of 3.1%.

Figure 1: Real Gross Domestic Product Growth by State, First Quarter 2019, %

Source: Bureau of Economic Analysis

Figure 2 

Chart: Percent Change in Real GDP by State, 2018:Q4-2019:Q1

Source: Bureau of Economic Analysis

This is the third consecutive quarter in which Minnesota’s economy has grown more slowly than that of the United States generally. Over that period, the U.S. economy has grown by 9.0% in real terms, while ours has grown by 6.3%.

Does this reflect a longer term trend?

The BEA has data on state quarterly real GDP growth going back to the start of 2005. In the 23 quarters from then until the end of 2010, Minnesota’s growth rate was faster than the U.S. rate in 48% of them. In the 33 quarters since the start of 2011, Minnesota’s growth rate was faster than the U.S. rate in 42% of them.

This isn’t ‘convergence’

There are those who say that this is the result of ‘convergence’, that Minnesota’s economy is growing relatively slowly because it is already relatively rich. As I’ve written before, the data does not support this.

If you are interested in finding out more about economic growth in Minnesota, its record, causes, and prospects, take a look at our report, ‘The State of Minnesota’s Economy: 2018‘.

John Phelan is an economist at the Center of the American Experiment. 




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