Fueled by Service Sector, N.D. Gross State Product Totals $17.2 billion in 1998

North Dakota’s gross state product totaled $17.2 billion in 1998, a 0.2 percent share of the U.S. total, according to the recent Economic Brief released by the North Dakota State Data Center at North Dakota State University.

North Dakota’s share is one of the lowest in the nation. The contributions of California, New York, and Texas comprised more than one-quarter of the U.S. total; 12.8 percent, 8.1 percent, and 7.4 percent of the U.S. total respectively. "Between 1990 and 1998, North Dakota’s gross state product increased by more than 32 percent or $5.5 billion," said Richard Rathge, Director of the State Data Center. "This means that the production from labor and property in the state added more than $700 million to the state’s economy during that time period after adjusting for inflation. This illustrates the economic health and increased diversity of the state’s economy."

The service industry accounted for the largest share of North Dakota’s gross state product in 1998 (18.1 percent). Business services are the real growth sector in the service industry. Output among business services more than doubled between 1990 and 1998, growing to $452 million. "We need to pay very close attention to this sector of our economy. The information age, which is a major component of this sector, may provide the key to economic growth in our rural areas," said Rathge.

Social services and health services saw a similar dramatic rise in output, expanding 100 percent and 58 percent respectively. Government followed at 14.9 percent with finance, insurance and real estate third at 13.4 percent. The mining industry accounted for the smallest share of North Dakota’s gross state product in 1998 (2.7 percent).

According to the Bureau of Economic Analysis, gross state product, often considered the state counterpart of the nation’s gross domestic product, is the value added in production by the labor and property located in the state.

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Source: Richard Rathge, (701) 231-8621, richard_rathge@ndsu.nodak.edu
Editor: Tom Jirik, (701) 231-9629, tjirik@ndsuext.nodak.edu

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