New U.S. Economic Data Underscores Trouble Energy States Face

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But growth in South Dakota has been strong, increasing by 9.2 percent in the third quarter of 2015.

South Dakota saw robust economic growth in the mid-to-late portion of last year, while gains in the value of goods and services produced in states with sizeable natural gas and oil sectors sputtered, according to data the U.S. Bureau of Economic Analysis released Wednesday.

Real gross domestic product in South Dakota, in the third quarter of 2015, increased by 9.2 percent over the previous quarter, the Bureau of Economic Analysis data show. In 47 states and the District of Columbia, real GDP grew between the two quarters. But the overall growth rate for U.S. states slowed to 1.9 percent in the third quarter, from 3.8 percent in the second quarter.

(U.S. Bureau of Economic Analysis)

Real GDP is an inflation-adjusted measure of the market value of goods and services produced within a place during a period of time, and is a commonly used indicator of economic health.

Alaska, North Dakota and West Virginia were the three states that saw drops in real GDP. The energy industry is an important economic engine in Alaska and North Dakota, and both states have felt the effects of the ongoing slump in oil and natural gas prices.

Other states with economies that are hitched tightly to the natural gas and oil sectors experienced flimsy growth during the third quarter of 2015. Real GDP ticked upwards by a paltry 0.1 percent in Texas and Oklahoma, and by 0.3 percent in Wyoming. Louisiana fared slightly better, with a growth figure of 1.6 percent.

The largest contributor to the strong gains in South Dakota was the agriculture, forestry, fishing, and hunting sector, according to the Bureau of Economic Analysis.

Among the other states where real GDP increases were on the high side in the third quarter of 2015 were Kansas, where the growth rate was 6.5 percent, Iowa, where the rate was 6.4 percent and Nebraska where it was 5.4 percent.

Bill Lucia is a Reporter for Government Executive’s Route Fifty.

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