The U.S. Bureau of Economic Analysis said today that the Gross Domestic Product fell 4.8 percent in South Carolina in the first quarter of 2020. In fact, it fell in every state and for the national as a whole, GDP fell 5%.
The largest drop was in New York: 8.2 percent. The smallest drop was in Nebraska: 1.3 percent.
By industry, construction fell by just .8 percent, and real estate and rental and leasing fell by just 1.1 percent. But GDP also showed some interesting results as a result of a pandemic, and large government spending in response:
- Accommodation and food services fell 26.8 percent, the leading contributor to negative GDP in 29 states.
- Arts, entertainment, and recreation fell by 34.7 percent, a contributor to GDP drop in every state.
- Healthcare and social assistance fell 7.8 percent, largely the result of suspension of profitable discretionary procedures.
- Agriculture, forestry, fishing, and hunting increased 15.5 percent, which moderated GDP decreases in 17 states.
The Federal government’s contribution to GDP rose by 2.2 percent, a function of $6 trillion in stimulus spending. But state and local government’s contribution to GDP fell by 4.9 percent.
Our take? High unemployment, coupled with the inherent conflict of social distancing and dining out or attending a ball game is a major factor in a struggling economy. However, with likely home buyers among the least impacted by the rise in unemployment, construction, especially residential construction, and real estate are bright spots. And if you have the time, and the means, why not go fishing?