New and Updated State Estimates of the Regional Economic Accounts

Results of the 2024 Annual Update

By Ledia Guci and Nicholas Wetzler  |  December 19, 2024

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On September 27, 2024, the U.S. Bureau of Economic Analysis (BEA) began releasing the results of the annual update of the Regional Economic Accounts (REAs). This update was released concurrently with the update of the National Economic Accounts (NEAs), which consist of the National Income and Product Accounts (NIPAs) and the Industry Economic Accounts, a reflection of the recent harmonization of the annual update of these accounts. The release featured new and updated quarterly and annual statistics on state personal income and gross domestic product (GDP) by state followed by annual statistics on personal consumption expenditures (PCE) by state released on October 3, 2024. County-level personal income and GDP statistics were also released later in the year. The results from these releases will be discussed in a forthcoming article in the Survey of Current Business.

With the 2024 annual update, the REAs incorporated the results of the annual update of the NEAs, which included methodology and presentation changes, as well as the incorporation of new and revised national data. Main methodology and presentation updates to the NEAs included improved classification of federal financial assistance for financially troubled multiemployer pension plans as authorized by the American Rescue Plan Act of 2021; replacement of data from the U.S. Census Bureau Annual Survey of State and Local Government Finances with data from Census' Value of Construction Put in Place (VPIP) Survey to estimate investment in new structures by state and local governments; and improved territorial adjustment for trade in services with Puerto Rico to better align the NIPAs with BEA's Puerto Rico GDP estimates.¹ In addition, the REAs incorporated more complete and detailed regional source data than those previously available.

The annual GDP by state and state personal income statistics were revised from 2019 to 2022, and new statistics based on more complete source data and the annual methodology were released for 2023.² PCE by state statistics were revised from 2019 to 2022, and new statistics released for 2023. Quarterly estimates of GDP and personal income by state were revised from the first quarter of 2019 through the first quarter of 2024, and new estimates were released for the second quarter of 2024.

This article focuses on the annual state estimates for 2023 as well as summarizes some of the impacts of the annual update on the REA estimates. Additional information on the annual update is available at “Information on 2024 Annual Updates to the National, Industry, and State and Local Economic Accounts.”

This section provides analysis based on the latest data on GDP by state, state personal income, and PCE by state. These statistics offer valuable insights into the value of goods and services produced by industries, the incomes earned by households, and the composition of household consumption in each state. When considered together, they provide a deeper and more nuanced understanding of the variation in economic trends and outcomes across states.

GDP by state

Nationally, current-dollar GDP increased 6.6 percent in 2023, following a 9.8 percent increase in 2022 (table 1). Current-dollar GDP increased in all states and the District of Columbia in 2023. States with the largest increases were Florida (9.2 percent), Washington (8.7 percent), and South Carolina (8.4 percent). Additionally, 22 other states had above-average increases in current-dollar GDP in 2023 that ranged from 6.7 percent in Georgia and Oregon to 8.2 percent in Nebraska, Nevada, and North Carolina. Current-dollar GDP increased 6.5 percent in the District of Columbia.

Price changes can significantly influence the economic view provided by current-dollar GDP statistics. Inflation-adjusted, or real, GDP presented a more moderate picture of economic growth in 2023, both nationally and across states (chart 1). At the national level, real GDP grew 2.9 percent. State-level real GDP growth ranged from 0.2 percent in Iowa to 7.8 percent in North Dakota, with the District of Columbia experiencing a 1.0 percent increase.

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Industries experienced varying price changes in 2023. For example, while most industries experienced price increases, the mining, quarrying, and oil and gas extraction industry and the agriculture, forestry, fishing, and hunting industry saw price declines. These falling prices contributed to a decrease in current-dollar GDP for these industries, even as production increased (reflected in real GDP growth), with particularly strong growth in the mining industry (chart 2).

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In 2023, real GDP growth was driven by a diverse range of industries. Real GDP by industry, or real value added—a measure of an industry's contribution to GDP—grew most rapidly in mining, quarrying, and oil and gas extraction (33.6 percent), retail trade (10.9 percent), and information (8.6 percent). Together, these industries contributed 1.6 percentage points to national real GDP growth (chart 3). Other notable contributors included educational services, health care, and social assistance; professional and business services; and finance, insurance, and real estate, each contributing at least a quarter of a percentage point to national real GDP growth. In contrast, several industries experienced declines in real GDP, including construction, durable goods manufacturing, wholesale trade, and “other services” (except government and government enterprises).

The fastest growing industries nationally played a significant role in driving overall growth in the states with a specialization in those industries. Alongside North Dakota, Texas (7.4 percent) and Oklahoma (7.2 percent) were among the fastest growing states in real GDP. Mining, quarrying, and oil and gas extraction was by far the largest contributor to real GDP growth in all three states, adding 6.2 percentage points to real GDP growth in North Dakota, 3.7 percentage points in Texas, and 4.0 percentage points in Oklahoma. Retail trade was the second-largest contributor, accounting for 0.7 percentage point in each state.

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After Iowa, Illinois (1.0 percent) and Delaware (1.1 percent) were among the slowest growing states. While real GDP grew for several industries in these states, including retail trade and information, other industries such as agriculture, forestry, fishing, and hunting; construction; and durable goods manufacturing subtracted from real GDP growth in these states resulting in slow overall growth (chart 4).

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State personal income

Nationally, current-dollar personal income increased 5.9 percent in 2023, following a 3.1 percent increase in 2022 (table 1). Changes in state personal income ranged from 1.8 percent in North Dakota to 8.2 percent in Florida (chart 5). Along with Florida, Wyoming (7.8 percent), Washington (7.3 percent), South Carolina (7.1 percent), and Arizona (7.0 percent) were among the states with the largest increases in personal income. In addition to North Dakota, Iowa (2.2 percent) and Alaska (3.8 percent) were among the states with the smallest increases in personal income. In the District of Columbia, personal income increased by 7.0 percent.

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At the national level, the increase in personal income resulted from a sizable increase in net earnings and property income—dividends, interest, and rent—and a more modest increase in personal current transfer receipts (chart 6). Net earnings, property income, and personal current transfer receipts increased by 5.2 percent, 10.8 percent, and 3.1 percent, respectively. Net earnings and property income increased in all states, while personal current transfer receipts declined in several states, most notably in Alaska (chart 7).

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Increases in net earnings—comprised of compensation of employees and proprietors' income—were the leading contributor to the increase in personal income for many states. Net earnings increased across all states, with the increases ranging from 0.6 percent in Iowa to 7.8 percent in Florida.

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Compensation of employees (wages and salaries plus supplements to wages and salaries), the largest component of net earnings as well as personal income, increased 5.6 percent at the national level. Across industries, compensation increased the fastest in mining, quarrying, and oil and gas extraction (12.4 percent) and arts, entertainment, recreation, accommodation, and food services (9.1 percent) (chart 8). Mining, quarrying, and oil and gas extraction was also the fastest growing industry in real GDP.

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Compensation increased by 8.0 percent in Florida and 6.6 percent in Wyoming, the fastest growing states in personal income (chart 9). The slowest growing states in personal income—Iowa and North Dakota—also had sizable increases in compensation, at 4.7 percent and 7.2 percent, respectively.

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Proprietors' income increased nationally 3.4 percent. In Florida and Wyoming, proprietors' income increased by 7.2 percent and 3.7 percent, respectively. Iowa and North Dakota had the largest declines in proprietors' income, −14.9 percent and −17.3 percent, respectively, driven by declines in farm proprietors' income.

Property income increased nationally 10.8 percent in 2023. Property income increased in all states and the District of Columbia, with the increases ranging from 6.7 percent in North Dakota to 12.6 percent in Maine (chart 7). Lastly, personal current transfer receipts increased 3.1 percent at the national level. Personal current transfer receipts declined in several states, with Alaska experiencing the largest decline in this component (−9.9 percent).

PCE by state

Nationally, current-dollar PCE increased 6.4 percent in 2023, following a 9.8 percent increase in 2022 (table 1). The states with the largest increases in PCE were Florida (8.1 percent), Maine (7.4 percent), Arizona (7.2 percent), and New York (7.2 percent) (chart 10). The states with the lowest increases were Iowa (4.7 percent), Michigan (4.8 percent), and Mississippi (4.9 percent). Florida was also the fastest growing state in personal income, and Iowa was among the slowest growing states in personal income. In the District of Columbia, PCE increased 7.9 percent.

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The PCE categories with the largest increases were food services and accommodations (10.4 percent), recreation services (9.2 percent), and health care (8.6 percent) (chart 11). Health care and housing and utilities were the largest contributors to PCE growth in both the fastest and slowest growing states (charts 12 and 13). Together, these two categories contributed 2.7 percentage points to national PCE growth and at least 3.0 percentage points to PCE growth in the fastest growing states. They also contributed 1.7 percentage points to PCE growth in Iowa, 1.8 percentage points in Michigan, and 2.1 percentage points in Mississippi.

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In addition to personal income, regional trends in population growth may help explain some of the regional differences in PCE growth. Typically, states with the largest increases in PCE tend to have faster growing populations, while states with slower increases or declines in PCE tend to have slow growing or declining populations. In 2023, population grew 0.5 percent nationally (chart 14). States with the highest population growth were South Carolina (1.7 percent), Florida (1.6 percent), and Texas (1.6 percent). These states were also among the states with large PCE increases. Population declined in eight states, with New York (−0.5 percent), Louisiana (−0.3 percent), Illinois (−0.3 percent), and Hawaii (−0.3 percent) experiencing the largest population declines. Of these, Louisiana was among the states with lowest PCE growth.

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BEA released updated historical estimates for GDP by state, state personal income, and PCE by state measures. The updated estimates reflect the incorporation of the results of the 2024 annual update of the NEAs as well as the incorporation of newly available and revised regional source data. No methodological changes were made to the REA statistics, and no presentational changes were made to the published REA tables. This section highlights the major regional source data that were updated and provides a summary of the impacts of these updates on the annual state-level measures.

Updates to source data

BEA incorporated several newly available and revised regional source data, including annual source data that became available since the comprehensive update of the REAs in September 2023. A summary of the annual major data sources for each of the statistics is provided in table 2. These data include Census Bureau American Community Survey and Annual Survey of State and Local Government Finances, U.S. Bureau of Labor Statistics Quarterly Census of Employment and Wages (QCEW) and Occupational Employment Statistics, Internal Revenue Service (IRS) data, and U.S. Department of Agriculture farm statistics.

Summary of revisions

BEA released updated annual GDP by state statistics for 2019–2022. The revisions to the GDP by state statistics for this period are largely due to the incorporation of updated national values and state source data. At the national level, current-dollar GDP was revised upward for all 4 years: 2019 (0.1 percent), 2020 (0.1 percent), 2021 (0.4 percent), and 2022 (1.0 percent) (table 3). The revisions to current-dollar GDP by state were less than 2.0 percent each year for most states. In general, revisions to later years tend to be larger, as new and more complete source data are incorporated into the statistics.

The revisions to current-dollar GDP by state in 2019 and 2020 were less than 1.0 percent in absolute value for all states. In 2021, the revisions to current-dollar GDP by state ranged from a downward revision of 0.4 percent in Vermont to an upward revision of 1.6 percent in Louisiana. The revisions to current-dollar GDP by state in 2022 ranged from an upward revision of 0.1 percent in Rhode Island to an upward revision of 2.6 percent in Delaware. Other states with revisions of 2.0 percent or greater were Hawaii (2.0 percent), Mississippi (2.0 percent), Nevada (2.0 percent), New Mexico (2.1 percent), Louisiana (2.2 percent), and Montana (2.4 percent).

State personal income statistics were revised from 2019–2022. Revisions to state personal income are largely due to updated and new QCEW and IRS data. At the national level, personal income remained virtually unchanged for 2019 and 2020 and was revised upward for 2021 (0.1 percent) and 2022 (1.2 percent) (table 3). The revisions to state personal income for these years were less than 2.0 percent for most states.

The revisions to state personal income in 2019 were very small and were within 0.1 percent in absolute value. In 2020, the revisions to state personal income ranged from a downward revision of 1.3 percent in Connecticut to an upward revision of 1.1 percent in the District of Columbia. The revisions to state personal income in 2021 ranged from a downward revision of 1.3 percent in Florida to an upward revision of 2.5 percent in South Dakota. Other states with revisions 2.0 percent or greater were New Hampshire (2.0 percent), Utah (2.0 percent), Arkansas (2.4 percent), and Idaho (2.4 percent). In 2022, the revisions to state personal income ranged from a downward revision of 0.4 percent in Florida to an upward revision of 5.2 percent in Arkansas. In addition to Arkansas, 13 other states and the District of Columbia had revisions of 2.0 percent or greater.

Lastly, PCE by state statistics were also revised from 2019–2022. The revisions to PCE by state are largely due to updated source data including the QCEW, housing data from the American Community Survey, and updated national PCE estimates from the NIPAs. National PCE was revised upward for all 4 years: 2019 (0.1 percent), 2020 (0.1 percent), 2021 (0.4 percent), and 2022 (1.0 percent). The revisions to PCE by state for these years were less than 2.0 percent for most states.

The revisions to PCE by state in 2019–2021 were less than 1.0 percent in absolute value for all states. In 2022, the revisions to PCE by state ranged from a downward revision of 0.3 percent in Rhode Island to an upward revision of 2.8 percent in Wyoming. In addition to Wyoming, New Hampshire had a revision larger than 2.0 percent.