Overall macroeconomic performance of a region is a critical measure for companies considering a corporate site location project. Generally, companies seek out growing markets that attract industry and talent. Key measures of regional economic performance will include the measures noted in the table below.
Gross domestic product (GDP), the featured measure of U.S. output, is the market value of the goods and services produced by labor and property located in the United States. GDP size and growth is a critical measure of economic success that makes regions more or less attractive to companies considering an economic development incentive decision. GDP serves as a gauge of our economy’s overall size and health. GDP measures the total market value (gross) of all U.S. (domestic) goods and services produced (product) each year.[i] When compared with prior periods, GDP tells us whether the economy is expanding by producing more goods and services or contracting due to less output—which ultimately defines whether the economy is in a recession.
The US GDP is $23.1 T which is massive. China is the next largest global economy with nearly $17 T in GDP, but the U.S. economy remains larger than Japan, the United Kingdom, Germany, France, and Italy combined.[ii] GDP as measured at the state level provides an important measure of the size of markets as well as the growth potential all impacting company economic development incentive decisions. As the table below illustrates, Cincinnati, Indianapolis, and Louisville’s GDP have all grown substantially since 2010 with the Cincinnati region leading the way among these three mid-sized urban markets.
|Regional GDP Comparison|
|Area of Study||Cincinnati||Indianapolis||Louisville|
Cincinnati is the 28th largest Metropolitan Statistical Area (MSA) from a GDP standpoint in the United States, Indianapolis follows as the 29th largest MSA from a GDP standpoint while Louisville trails in 49th place. However, these regions are all top 50 MSA’s from a macroeconomic standpoint and succeed as major mid-sized urban markets that offer growing economies at an affordable cost of doing business.