CHARLESTON — West Virginia topped the nation in growth of gross domestic product for the first quarter of 2019, according to the U.S. Department of Commerce.
West Virginia’s nation-leading percent change from the last few months of 2018 to the first few months of 2019 was 5.2%.
Gross domestic product is the total monetary or market value of all the finished goods and services produced within a specific time period.
Changes from period to period can be subject to fluctuation. Percent change depends on the economic conditions of the prior period up against the current conditions.
The snapshot of growth is welcome compared to the economic doldrums West Virginia faced just a few years ago.
“If you look at where the state’s growth is now compared to, say, 2016, it’s certainly a much better position to be in,” said Brian Lego, with West Virginia University’s Bureau of Business and Economic Research.
“Leading the nation in a particular quarter isn’t as important as that we’ve crawled out of the hole the state was in.”
The U.S. Department of Commerce noted that mining
for the nation increased 26.5%, after increasing 38% in the
fourth quarter.
The mining industry was the leading contributor to growth in several states, including the three fastest growing states of West Virginia, Texas and New Mexico.
The mining category includes not only coal but also natural gas.
West Virginia has benefited from recent growth in coal exports as well as natural gas activity, driven by the construction of major pipelines across the state.
Lego warned those sectors can represent volatile economic activity.
“These construction projects don’t go on in perpetuity. They taper and then they end,” he said. “What happens once that phase comes to an end? That’s the real important question beyond the
next year, maybe two. You need more to pick up the slack.”
U.S. Commerce Secretary Wilbur Ross sent out congratulations to West Virginia on social media. Gov. Jim Justice also cheered the numbers.
“I’ve said for a long time that our people won’t tolerate being 50th anymore. But to see us jumping up to #1 in the entire country, over and over again, in so many different categories of economic growth, it’s truly phenomenal,” Justice said in a news release.
“There’s no way around it, with West Virginia on the national stage time and again, this is one of the best years in the history of our state’s economy.”
West Virginia also led the nation in personal income growth for the first quarter of 2019, with a 5.6% growth rate.
That report said construction was the leading contributor to the earnings increase in West Virginia.
West Virginia’s gross domestic product for all of 2018 was $77.48 billion, which represented 39th in the country.
West Virginia made headlines in 2017 with first quarter GDP growth of 3%.
That ranked second in the country for the period, behind Texas.
The trend prompted The Hill to describe “How West Virginia got to 3% GDP growth.”
That look concluded that West Virginia’s economy was bolstered by a global infrastructure boom, the rising price of natural gas and finally leaving recession behind.
Lego said the biggest part of West Virginia’s growth came from a few counties, including the Eastern Panhandle in the D.C. metropolitan area and the natural gas hotbed that includes north-central West Virginia and counties like Doddridge, Wetzel and Marshall.
“It’s about seven counties that are really accounting for the growth. The other 48 aren’t declining. But the ones that are growing in the balance of the state aren’t growing in a strong pace,” Lego said.
The risk — not necessarily the reality — is that such growth might lag without greater economic diversification, he said.
“That stuff is going to peel off at some point, and if nothing else is there to fill that void, we could be in for some dicey conditions over the next several years,” he said.
“The thing we have long emphasized is the ephemeral nature of all this energy infrastructure development.”
Twitter @BradMcelhinny
