NCPA - National Center for Policy Analysis

Growth In Productivity And Jobs Differs Little Across The U.S.

October 19, 2000

Commerce Department officials have been startled to discover that increases in productivity and employment are more or less evenly distributed across the entire country. For most of the late 1980s and early 1990s, the West and the South saw the largest gains in output and population.

But the latest figures show that between 1995 and 1998 output per employee hour rose at a 2 percent to 2.4 percent rate in every region of the country.

  • Experts surmise that the key factor in the deregionalization of the U.S. economy has been the spread of high-technology from coast to coast.
  • Silicon Valley may be information technology's epicenter, but it is now everywhere and it has contributed greatly to the Northeast's productivity surge in finance and the Midwest's manufacturing revival.
  • In fact, severe labor shortages in the Midwest are forcing manufacturers to rely even more on using technology to boost productivity.

The region with the highest unemployment rate, the West, is only 1.1 percentage points higher than the region with the lowest unemployment, the Midwest. Officials say that is the smallest difference in unemployment rates they have seen since they began collecting the data.

Some experts even suggest that the new era of high-technology may mean that region-specific booms and busts may be things of the past.

Source: Charles J. Whalen, "High-Tech Hustle Sweeps the Nation," Business Week, October 16, 2000.


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