July 24, 2003

 

Service Industry Accounts for Largest Share of N.D. Gross State Product

North Dakota’s gross state product (GSP) totaled $19 billion in 2001, a 0.2 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 nearly 30 percent of the U.S. total; 13.4 percent, 8.2 percent, and 7.5 percent of the U.S. total GSP, respectively.

The service industry accounted for the largest share of North Dakota GSP in 2001. Growth in this sector has been significant and now represents nearly one-fifth (19.3 percent) of the state’s total production income. "The growth in this economic sector is driven largely by health services, which accounted for 44 percent of the overall service sector. During the past 10 years, health services grew 72 percent. This is fueled, in part, by the growing proportion of seniors in our state," said Richard Rathge, Director of the State Data Center. "Another sign of the times is the rapid growth in business services spurred on by the information age. Business services grew 211 percent in the past 10 years and now represent 15 percent of the overall service sector," Rathge said.

In contrast, agriculture, which captured nearly 12 percent of North Dakota GSP in 1992 has dropped significantly to 5.3 percent in 2001. While government represented the second-largest share of the state’s total production income in 2001, this share has declined from nearly 18 percent in 1991 to 15.6 percent in 2001. The finance/real estate sector, accounting for 14.6 percent of North Dakota GSP in 2001, saw a slight decline between 2001 and 2002. The mining industry accounted for the smallest share of North Dakota GSP in 2001 (3.5 percent).

According to the Bureau of Economic Analysis, gross state product, often considered the state counterpart of the national 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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