Economic Trends in U.S. Metro Areas: Real GDP Growth, Construction, and Real Estate Highlights for 2023
In 2023, U.S. metro areas had mixed but optimistic economic performance. There was varied growth in real GDP, an active construction sector, and changing real estate dynamics. Some metro areas excelled, but others grew slowly due to regional issues and economic pressures.
Real GDP Growth: Regional Variations
In 2023, real GDP growth across U.S. metro areas showcased significant regional disparities. Data from the Bureau of Economic Analysis shows that the fastest-growing metros were in the Sun Belt. This includes cities like Austin, Texas, and Phoenix, Arizona.
Austin, for instance, recorded a GDP growth rate of 4.2%, driven by its thriving tech sector and expanding manufacturing base. Similarly, Phoenix saw a 3.8% increase, fueled by strong gains in construction and professional services.
Construction Sector: A Bright Spot
The construction industry played a pivotal role in driving economic activity across many metro areas. High housing demand, despite rising interest rates, pushed developers to boost residential construction.
“The demand for housing is still outpacing supply in many regions, particularly in fast-growing metro areas,” said Mark Hamilton, a senior economist at the National Association of Home Builders (NAHB).
Commercial construction also gained, especially in metros with booming tech and healthcare sectors. San Jose, California, for example, saw a surge in office and research space to accommodate Silicon Valley’s tech giants.
