Sharp Decline in Real GDP in All States: 2Q20
Real gross domestic product (GDP) decreased in all 50 states and the District of Columbia, in the second quarter of 2020 compared to the previous quarter, as a result of reflecting “stay-at-home” orders across the country due to COVID-19. The U.S. Bureau of Economic Analysis reported the real GDP growth rates, measured on a seasonally adjusted annual rate basis, ranged from -20.4% in the District of Columbia to -42.2% in Hawaii and Nevada (states with robust travel and tourism sectors).
Nationwide, real GDP growth decreased to 31.4% in the second quarter of 2020, after a decrease of 5.0% in the previous quarter. Accommodation and food services; healthcare and social assistance; and durable goods manufacturing were the leading contributors to the decline in real GDP in the second quarter of 2020.
Regionally, real GDP growth rates, ranged from -27.6% in Rocky Mountain to -34.0% in Mideast in the second quarter of 2020 compared to the first quarter of 2020.
According to the industry statistics, 20 of 22 industry groups contributed to the second quarter decline in real GDP while Finance and Insurance and Federal government spending increased in the second quarter. The decrease in private goods-producing industries, led by motor vehicles, bodies and trailers, and parts, contributed to the decrease in durable goods manufacturing. The decrease in private services-producing industries were led by decreases in accommodation and food services, reflecting “stay-at-home” orders and closing of in-dining restaurants and bars; along with health care and social assistance; and transportation and warehousing. The decrease in government spending reflected a decrease at the state and local level that was partly offset by an increase in federal government spending.
Accommodation and food services decreased 88.4% nationally and was the leading contributor to the real GDP decrease in Hawaii and Nevada (-42.2%). Healthcare and social assistance decreased 48.1% across the country and was the leading contributor to the real GDP decrease in Tennessee (40.4%), the state with the third largest decrease. Finance and insurance increased 11.9% nationally, offsetting the decline in Delaware (-21.9), the state with the smallest decrease in real GDP.