Medford and Grants Pass GDP Growth Outpace U.S. Average in 2017September 27, 2018 The Bureau of Economic Analysis just released the gross domestic product (GDP) figures by metropolitan area for 2017. The metropolitan areas in the U.S. grew by 2.1 percent from 2016 to 2017. The Medford Metropolitan Statistical Area (Jackson County) had the 103rd fastest growth in gross domestic product among the nation’s 384 metropolitan areas (+2.6%). Josephine County’s economy grew even faster, with the 31th fastest GDP growth (+4.3%). The Bend-Redmond MSA tied with the Grants Pass Metropolitan Statistical Area growth rate in GDP.
As a reminder, gross domestic product represents an estimate of the total dollar value of all goods and services produced in the given geography over a specific time. It is the economy's output. The majority of this output is market production, meaning those goods and services produced for sale in the market. However, a portion of GDP is non-market production, such as education services provided by local governments or management of our public lands. Gross domestic product is equal to the value of final goods. For instance, if a business produces cogs (intermediate product) for clocks (final product) then their production is not directly counted in GDP. Instead GDP measures the value of the clock (final product), which theoretically includes the production value of the individual cog.
Nationally, metropolitan areas averaged a 2.1 percent increase in GDP with the professional and business services, trade, financial activities, education and health services, durable goods manufacturing, and information sectors all contributing between 0.21 and 0.44 percentage points to overall metro area GDP growth.
In Jackson County, industries contributing to GDP growth included education and health services; professional and business services; trade; and transportation, warehousing, and utilities. Jackson County industries subtracting from GDP growth were other services and information.
In Josephine County, finance, insurance, and real estate had a substantial contribution to overall GDP growth in 2017, accounting for about 40 percent of total GDP increase. Other industries boosting Grants Pass MSA GDP were education and health services, leisure and hospitality, and trade. A couple industries had negative GDP contribution in 2017. Professional and business services, information, and also other services reduced Grants Pass MSA (Josephine County) GDP growth.
Jackson County’s total economic output in 2017 was $7.4 billion, about 12 percent higher than the peak before the most recent recession in 2005. Medford MSA total economic output is up 24 percent from the depths of the recession in 2010, strong gains in just seven years. To put that into perspective, that is roughly an increase in annual economic output of more than $1.4 billion compared with 2010, in real dollars.
Josephine County’s total gross domestic product was almost $2.2 billion in 2017, 6 percent above the previous pre-recession peak in 2006. Josephine GDP declined by about 10 percent from 2006 to 2010. Between 2010 and 2017, total economic output
rose by about 17 percent. The Rogue Valley was well above its pre-recession economic output level reached over a decade ago by 2017. If current economic trends continue through 2018, this year will likely see another rise in real, or inflation-adjusted, gross domestic product totals in the Rogue Valley.
It is important to remember that gross domestic product is a lagging economic indicator. It tells us something about the past, in this case, the output in our economy nearly a year ago. Many of the most referenced economic indicators are lagging, such as the unemployment rate, nonfarm payroll employment, and the consumer price index. These indicators tell us where we were, but do a relatively poor job of telling us where we are going. That being said, we have continued to see strong job growth through most of 2017 with employment levels sitting roughly 2 to 3 percent above where we were at this time last year. Employment is a major driver of gross output, which bodes well for continued strong gains in gross domestic product in 2018.