The U.S. economy expanded at a faster rate than expected in the third quarter of 2022, with real gross domestic product growing at an annualized rate of 3.2%, rebounding from a 0.6% contraction in the previous quarter. The strong third quarter growth comes as welcome news in a period of rising pessimism. Ahead of the news, a December 2022 Bloomberg poll of economists put the odds of a recession in 2023 at 70%, up from 50% in September.
The industries adding the most value to the U.S. economy in the third quarter of 2022 were information, which contributed 0.88 percentage points to real GDP growth; professional, scientific, and technical services, which contributed 0.59 points to growth; and mining – including oil and gas extraction – which contributed 0.5 points. The construction sector, meanwhile, detracted 0.77 points from real GDP growth.
Most state economies also accelerated. Still, in three states the economy shrank in the third quarter of 2022, and among the states that reported real GDP expansion, growth varied considerably, ranging from an annualized growth rate of 0.3% up to 8.7%.
Using data from the Bureau of Economic Analysis, 24/7 Wall St. identified the states with the fastest growing (and shrinking) economies. States are ranked by the annualized change in real GDP, chained to 2012 dollars, from the second quarter of 2022 to the third quarter of 2022, the latest available state-level data. In the case of a tie, the state with the larger economy ranks higher.
In each of the seven states with the strongest third quarter growth, the resource extraction sector is an economic pillar. High oil prices and a rebound in oil and natural gas activities have boosted sector growth in the third quarter and with it GDP growth in states where the sector contributes significantly to the economy. (Here is a look at the price of gas every year since 1990.)
Additionally, strong growth in the information services sector contributed substantially to economic expansion in states like California, Massachusetts, and New York.
Across the 50 states, economic growth did not always translate to improvements in the job market, however. In 22 states – including five of the 10 with the strongest economic growth – the unemployment rate climbed from the end of the second quarter to the end of the third. (Here is a look at the 36 jobs with wages rising faster than inflation.)
Click here to see how fast the economy grew in every state last quarter.
Click here to read our detailed methodology.
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