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By Steven Koczak, PhD, Research Specialist
Gross Domestic Product (GDP) — which refers to the monetary value of final goods and services produced in an area in a given period of time — provides the broadest measure of an area’s economic activity and is a closely followed indicator. In the U.S., GDP estimates are compiled, calculated, and published by the Bureau of Economic Analysis (BEA), part of the U.S. Department of Commerce.
GDP is published as part of the National Income and Product Accounts (NIPA), which present information on the value and composition of national output. The NIPA, which date to the 1930s, were originally developed by a team led by economist Simon Kuznets and intended to measure the impacts of the Great Depression on the U.S. economy. Per the BEA, the “NIPA have become the mainstay of modern macroeconomic analysis.”
Background on County GDP
The BEA has long published GDP data for the nation, states, and metropolitan statistical areas (MSAs). However, it was not until December 2019 that they first released county-level GDP data for 2001-18. Their main argument was that such data were necessary to provide localized information to policymakers, and that MSA data left out important economic activity that didn’t take place within metropolitan areas.
In December 2023, the BEA released county (and MSA) GDP estimates for 2022 and revised annual estimates from 2017 to 2021. The agency publishes county-level GDP data in both nominal dollars (not adjusted for inflation) and real dollars (adjusted for inflation in 2017 chained dollars).
The BEA noted in its December 2023 press release that in the U.S. real GDP increased in 1,780 counties, decreased in 1,296 counties and was unchanged in 38 counties between 2021 and 2022. There was wide variation between the top and bottom performers with the percent change in real GDP ranging from 71.1% in Chouteau County, Montana to -57.6% in Kiowa County, Colorado. Across all 3,100+ counties in the nation, the median change in county GDP was 0.8% in 2022. For the balance of this article, we use real GDP because of how it better reflects economic output without the distorting effects of inflation.
Fastest Growing Counties in NYS
At $1.76 trillion, New York had the third-largest state economy in the nation in 2022. In 2021-22, New York State’s GDP grew by 2.3%, which ranked 15th nationally. In addition, the Empire State was home to 11 counties that ranked among the 150 largest county economies in the nation, including #2 New York County (Manhattan) with a $781 billion economy in 2022.
Drilling down to individual counties, we first examined those with the fastest percentage growth in GDP between 2021 and 2022. The 10 counties in New York State with the most rapid growth over this period are listed below with their labor market region:
- Greene (Capital Region), 17.7%
- Lewis (North Country), 7.8%
- Sullivan (Hudson Valley), 7.4%
- Tompkins (Southern Tier), 5.5%
- Steuben (Southern Tier), 4.7%
- Kings (New York City), 4.3%
- Queens (New York City), 4.2%
- Montgomery (Mohawk Valley), 4.1%
- Yates (Finger Lakes), 3.9%
- Richmond (New York City), 3.9%
The list of counties was geographically diverse, with seven of New York State’s 10 labor market regions being represented.
The 17.7% annual growth rate in Greene County’s GDP in 2022 is especially noteworthy. Not only did this make the area the 48th fastest growing county in the U.S., but it was also the fastest growing county in the Northeast.
What Makes Counties Grow?
The BEA also publishes information on how much individual sectors contributed to a county’s overall growth in real GDP. For example, Greene County’s GDP grew by 17.7% in 2022. Of this total, the Utilities sector accounted for 15.1 percentage points (pp) of growth. An important, but distant, contributor was #2 Financial Activities, which added 4.9 pp to GDP growth. Partially offsetting this growth were declines in Retail Trade (-1.9 pp) and Wholesale Trade (-1.3 pp).
The consensus among analysts is the rapid increase in Greene County’s Utilities sector was driven by increases in other sectors, like finance and tourism. The Albany-based Center for Economic Growth attributes the growth in Financial Activities to the Bank of Greene County’s recent attempts to become a regional player.
At 7.8%, Lewis County had the second most rapid GDP growth in 2022. Lewis’s growth was focused in the Agriculture (+3.6 pp) and Utilities (+3.3 pp) sectors, while its largest detractor was Manufacturing (-1.4 pp). Analysts attribute the gain in Lewis County’s Agriculture GDP to increased popularity of local foods and expanded production of corn and soybeans. Per local experts, growth in the Utilities sector stemmed from various green energy projects (e.g., increased use of solar panels and turbines) and the New York Power Authority's Smart Path clean energy transmission infrastructure project in the North Country, which upgraded 78 miles of transmission lines from the Canadian border to Croghan in Lewis County.
In third place at 7.4% was Sullivan County, whose GDP growth was largely driven by Financial Activities (+3.8 pp). This sector’s growth was due to a wide variety of real estate activity happening more or less all at once. This activity was described as running the spectrum from new housing starts, to significant amounts of refinancing and refurbishing of existing housing, to refurbishing houses for purposes of setting up vacation property rentals and many things in between. A main driver of this increased real estate activity was growth in the county’s population, which rose by more than 1,000 between 2000 and 2022, according to the latest estimates from the U.S. Census Bureau.
Per Capita Personal Income
The BEA does not calculate per capita GDP estimates because it would combine place-of-work GDP estimates with place-of-residence population estimates. This is especially problematic in places with high levels of daily in-migration (e.g., New York County) where people contributing to a county’s GDP (based on place of work) might live in other counties or states.
The agency does publish annual estimates of per capita personal income by county of residence, which sums wages, proprietors' income, dividends, interest, rents, and other income, and divides through by county population. This series is only available in nominal dollar terms. We considered growth in per capita personal income from 2021 to 2022. The population statistics used by BEA to calculate per capita personal income come from the Census Bureau’s midyear population estimates series, as published in July of the indicated year.
The 10 counties in New York State with the most rapid growth in per capita personal income (nominal dollars) between 2021 and 2022 are listed below with their labor market region:
- Westchester (Hudson Valley), 3.5%
- Nassau (Long Island), 2.8%
- Putnam (Hudson Valley), 2.5%
- Suffolk, (Long Island), 2.3%
- Dutchess (Hudson Valley), 1.8%
- Ulster (Hudson Valley), 1.7%
- Tompkins (Southern Tier), 1.3%
- Columbia (Capital Region), 1.2%
- Rockland (Hudson Valley), 1.1%
- Orange (Hudson Valley), 1.0%
The resulting list is dominated by Downstate suburban counties, primarily in the Hudson Valley and on Long Island. The two exceptions to this are #7 Tompkins County (Southern Tier) and #8 Columbia County (Capital Region).
Conclusions
New York State’s economy is large and diverse. Accordingly, while considering county-level data may be important in any state, it’s especially so in New York. Doing so lets us examine the component parts of the whole – the parts of the sum.
The big takeaway from doing so is that, while not every area of New York State grows uniformly or in lockstep with the others or the state as a whole, the overall story is still one of consistent and steady growth. The Empire State, ultimately, is only as strong as its regions, and the glue that binds them. For more information about county GDP and related topics, visit the BEA’s website at: https://www.bea.gov/data/gdp/gdp-county-metro-and-other-areas.
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“Manufacturing is a vital contributor to the Hudson Valley’s economy.”
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By Johny Nelson, Labor Market Analyst, Hudson Valley Region
Manufacturing is a vital contributor to the Hudson Valley’s economy. In 2022, the region’s factory sector consisted of 1,695 establishments employing 41,810 workers, per the Quarterly Census of Employment and Wages (QCEW).
While the sector accounted for just 5.4% of local private sector jobs, it contributed nearly $4 billion in wages. Manufacturing is responsible for an outsized share of total private sector wages (7.3%) due to its above-average pay levels. Average manufacturing wages in the region were $94,900 in 2022, or 34.5% higher than the private sector average wage ($70,500).
Manufacturing Job Trends
Over the past half century, automation, globalization, and the shift to a services-based economy have all contributed to manufacturing job losses in the U.S. and the Hudson Valley. However, the rate of local factory job losses has slowed in recent years. In 2017-22, manufacturing jobs in the Hudson Valley declined at an average annual rate of 0.5%, with total local job losses of 1,150 over the period.
With 8,120 workers, computer and electronic products represents the largest segment of the region’s manufacturing economy (3-digit NAICS industry level), accounting for roughly one in five factory jobs in 2022. In 2017-22, it experienced the most losses (-1,000) of any single manufacturing industry. In 2022, it also paid out more than $1.4 billion in wages, with an average annual salary of $175,700 – the highest among all local manufacturing industries.
IBM’s resurgence in the region is a promising sign for the overall computer and electronic products industry. “Big Blue” recently announced plans to invest $20 billion over the next decade to boost its manufacturing and research capabilities in the region. The company plans to make its Poughkeepsie (Dutchess County) campus the global hub for its quantum computing development. This campus happens to be the only site in the world where Big Blue builds mainframe systems. This development comes on the heels of the recently enacted $280 billion CHIPS and Science Act, which appropriates $52.7 billion in incentives for technology manufacturers to expand in the U.S.
In 2017-22, nine manufacturing industries grew in the region, adding a total of 2,360 jobs. Food manufacturing was, by far, the largest growing manufacturing industry with a net gain of 1,250 jobs. In 2022, food manufacturing employed 7,730, paid out more than a half billion dollars in total wages and had an annual average salary of $68,000.
The growth in food manufacturing employment is due to several key local factors such as expansions at Danone Foods in White Plains (Westchester County) and Milmar Foods in Goshen (Orange County). Another contributing factor is the increase in the number of restaurants in the region, which has boosted demand for locally produced food. For example, from 2020 to 2022, the number of restaurants grew by 2.7%, while restaurant employment grew by 26.5%.
A related manufacturing industry — beverage and tobacco products — also grew in 2017-22, adding 560 jobs, or 58.5%. A $40+ million project in the Town of Carmel (Putnam County) by Romania-based distiller Alexandrion Group, currently underway after some pandemic-induced delays, will present more opportunities for job seekers in the region.
Outlook for Manufacturing
Long-term industry projections prepared by the New York State Department of Labor expect employment in the Hudson Valley’s manufacturing sector to grow by 17.7% in 2020-30. The fastest percentage growth is projected in tobacco and beverage products (+40.0%) and food manufacturing (+26.0%).
One important issue facing the region’s manufacturers is an aging workforce. Data from analytics firm Lightcast show that about one-third of local manufacturing employees are 55 years of age or older – a factor that could hinder sustained growth.
Several recent government initiatives and investments should promote and re-establish high-tech manufacturing and innovation across the state and nation. One is the aforementioned CHIPS and Science Act, signed into law in August 2022, which provides $280 billion in funding to boost domestic research and manufacturing of semiconductors in the U.S. Also signed into law in 2022 was the groundbreaking Green CHIPS legislation, which aims to create jobs and promote economic growth, while turning the Empire State into a hub for semiconductor manufacturing.
In addition, high-tech manufacturers in the state are supported by the New York Manufacturing Extension Partnership (NY MEP). NY MEP is a network of organizations that provides growth and innovation services to small and mid-sized manufacturers throughout the state to facilitate the creation of new jobs while retaining existing ones.
Summing Up
The manufacturing sector is constantly evolving and always facing new challenges. Growing uncertainty in the economy, accompanied by rising production costs and a shortage of skilled workers, could become problematic. Nevertheless, recent government initiatives and private investments in manufacturing infrastructure have boosted optimism. As new technology emerges, bringing about new job opportunities, it is imperative that workforce developers across the region become proactive in training today’s workforce for tomorrow’s jobs.
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In November 2023, New York State’s seasonally adjusted private sector job count increased over the month by 5,500, or 0.1%, to 8,260,900. In addition, the state’s seasonally adjusted unemployment rate rose from 4.2% to 4.3% in November, while New York’s seasonally adjusted labor force participation rate increased from 61.6% to 61.7%.
Capital
Over the past year, the number of private sector jobs in the Capital Region rose by 7,900, or 1.8%, to 447,000 in November 2023. Job gains were largest in education and health services (+6,600), leisure and hospitality (+1,700), professional and business services (+1,000) and financial activities (+600). Losses occurred in manufacturing (-1,100), natural resources, mining and construction (-700) and trade, transportation and utilities (-400).
Central NY
The private sector job count in the Syracuse metro area increased over the past year by 2,300, or 0.9%, to 263,700 in November 2023. Job gains were largest in professional and business services (+1,700), leisure and hospitality (+600), trade, transportation and utilities (+400) and other services (+200). Employment declines occurred in education and health services (-300), information (-200) and manufacturing (-200).
Finger Lakes
From November 2022 to November 2023, the private sector job count in the Rochester metro area rose by 100, or less than 0.1%, to 451,900. Job gains occurred in education and health services (+6,400), trade, transportation and utilities (+600) and other services (+300). Losses were greatest in professional and business services (-2,900), leisure and hospitality (-2,800), natural resources, mining and construction (-900) and information (-300).
Hudson Valley
Over the past year, the number of private sector jobs in the Hudson Valley grew by 6,500, or 0.8%, to 810,600 in November 2023. Job gains occurred in education and health services (+10,400), leisure and hospitality (+5,800) and other services (+1,500). Employment losses were greatest in natural resources, mining and construction (-5,100), trade, transportation and utilities (-2,800), professional and business services (-1,600) and manufacturing (-800).
Long Island
For the year ending November 2023, private sector jobs on Long Island increased by 1,300, or 0.1%, to 1,147,800. Gains were greatest in education and health services (+6,600), leisure and hospitality (+4,400) and other services (+2,400). Declines were largest in trade, transportation and utilities (-4,800), natural resources, mining and construction (-4,000), professional and business services (-1,600) and financial activities (-1,300).
Mohawk Valley
For the 12-month period ending November 2023, the number of private sector jobs in the Mohawk Valley region held steady at 141,600. Over-the-year employment gains were largest in education and health services (+500) and leisure and hospitality (+400). Job losses occurred in manufacturing (-400), trade, transportation and utilities (-400) and natural resources, mining and construction (-200).
New York City
The private sector job count in New York City rose over the past year by 79,500, or 1.9%, to 4,177,100 in November 2023. Gains occurred in education and health services (+91,300), leisure and hospitality (+15,500), natural resources, mining and construction (+9,900) and professional and business services (+5,600). Over-the-year employment losses were greatest in information (-24,900), trade, transportation and utilities (-14,100) and other services (-2,500).
North Country
For the 12-month period ending November 2023, the private sector job count in the North Country region increased by 1,100, or 1.0%, to 108,900. Job gains were greatest in leisure and hospitality (+400), education and health services (+300) and natural resources, mining and construction (+300). Employment losses occurred in other services (-200).
Southern Tier
For the year ending November 2023, the Southern Tier’s private sector count fell by 1,300, or 0.6%, to 217,700. Gains occurred in education and health services (+400) and leisure and hospitality (+200). Losses were greatest in manufacturing (-500), professional and business services (-400), natural resources, mining and construction (-300), financial activities (-200), information (-200) and trade, transportation and utilities (-200).
Western NY
Over the past 12 months, the number of private sector jobs in the Buffalo-Niagara Falls metro area rose by 4,900, or 1.1%, to 468,000 in November 2023. Gains were greatest in leisure and hospitality (+3,800), education and health services (+2,000), professional and business services (+2,000) and other services (+1,100). The largest employment losses occurred in trade, transportation and utilities (-3,900) and financial activities (-400).
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