Real Estate Drive Gross State Product
Double-digit growth in construction, durable goods manufacturing and real estate activity drove Idaho’s gross state product up 8 percent. The U.S. Bureau of Economic Analysis reported Wednesday the value of all goods and services produced in Idaho last year totaled nearly $43.6 billion, about $220 million higher than the government's initial estimate in June. "Idaho ranks second in the nation in growth of real gross state product," said Idaho Commerce and Labor Director Roger B. Madsen. "This continued, consistent growth is a good indicator of Idaho's entrepreneurial climate and our quality work force. It also indicates how much our economy is changing and the need to change with it." Idaho's gross state product has risen 53 percent since 1997, faster than all but six other states. Manufacturing – of which high-tech manufacturing is a subset - remained the largest private sector segment of the economy, contributing 14.3 percent to the gross state product. It was followed by real estate at 11.9 percent and retail trade at 8.3 percent.
Economic activity generated by construction, which has been on a record pace since 2002, was up nearly 11 percent last year from 2003 while durable manufacturing and real estate jumped about 11.5 percent each. Construction and manufacturing activity have remained strong so far this year, based on an earlier federal report on personal income. Those two sectors were responsible for half of the income growth Idaho experienced between January and June this year. Job increases in construction were more than 15 percent last year, the highest growth in the state for any job category. In addition, construction permits with the Idaho Division of Building Safety were up 17 percent last year, and are up almost 40 percent since 2001.
The contribution to gross state product from government at all levels dropped slightly from 2003 to 2004 but was still just under 14 percent of the gross state product. Three-quarters of that was at the state and local level. Madsen said the new numbers underscore Idaho’s strong economic performance overall. "Unemployment is at an all time low at 3.5 percent,” Madsen said. "Residential and commercial building construction is at an all time high, exceeding $400 million a month for the first time in June." The dollar value of Idaho's exports is up nearly 8 percent. Summer lodging revenues are up 10.5 percent. "Our challenge now is to make sure all this economic activity is spread more evenly throughout the state and evolves into increases in per capita personal income," he said.
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