NEWS for North Dakotans
Agriculture Communication, North Dakota State University
7 Morrill Hall, Fargo, ND 58105-5665

June 24, 1999

North Dakota's Gross State Product Reflects Shift Among Economic Sectors

The service industry led all sectors of North Dakota's economy in 1997 by accounting for 18.4 percent of the gross state product, which is the value at retail prices of all goods and services produced within a state. Government followed at 15.4 percent and Finance, Insurance and Real Estate (F.I.R.E.) came in third at 13.5 percent, according to a recent Economic Brief from the North Dakota State Data Center at North Dakota State University.

"This signals an important change in our state's economy," said Richard Rathge, data center director. "The diversification of North Dakota's economy is rapidly favoring the service industry, which has expanded by 66 percent between 1990 and 1997, as measured by gross state product."

Rathge says the largest sector within North Dakota's service industry is health services, representing 44 percent of the total service industry in 1997 and up 48 percent since 1990. Business services accounted for 13 percent of the total service industry, up 129 percent since 1990. In contrast, the agriculture sector has declined by nearly 12 percent during the period and in 1997 represented less than 7 percent of North Dakota's gross state product, Rathge says.

North Dakota's gross state product totaled $15.8 billion in 1997, or just 0.2 percent of the U.S. total, thereby making it one of the smallest shares in the nation. The contributions of California (12.7 percent), New York (8.1 percent) and Texas (7.4 percent) comprised more than one-quarter of the U.S. total. Gross state product is often considered the state counterpart to the nation's gross domestic product, according to the Bureau of Economic Analysis.

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Source: Richard Rathge (701) 231-8621

Editor: Dean Hulse (701) 231-6136

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