State GDP shrinks 2% in second quarter

Real gross domestic product in Colorado took a step backward in the second quarter, declining at an annualized rate of 2%, according to preliminary data released Friday by the Bureau of Economic Analysis.

Real GDP is an inflation-adjusted measure reflecting the value of goods and services produced in an economy.

That means that Colorado fared worse than the U.S. economy overall, which posted a real GDP decline of 0.6% in the second quarter. Colorado ranked 39th nationwide in terms of percentage change in GDP.

The state GDP numbers are preliminary. Initial reports for the first quarter showed a decline of 1.9% in Colorado, but the BEA now shows revised, positive real GDP growth of 2.9%.

Second-quarter GDP decreased in 40 states and the District of Columbia. Texas topped the nation in GDP growth, at 1.8%, while Wyoming recorded the biggest decline, at 4.8%.

Personal income increased in all 50 states and the District of Columbia, at an annual rate of 5.8%. Colorado’s personal income increased by 6.5%.

Colorado’s GDP decline was led by the Information sector, down 1.19%, Construction, down 1.05%; and mining, quarrying and oil and gas extraction, down 0.95%. Read the full report at bit.

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Brian Lewandowski, executive director of the Business Research Division at the University of Colorado Leeds School of Business, said the first-quarter GDP revision for Colorado is “interesting, not only the magnitude of change for Colorado, but the directional change.

“When I look back over the last 15 years, what we have seen is that Colorado has generally outperformed the nation

when it comes to economic growth, and we’ve been a Top 10 state or a Top 15 state in most metrics,” he said. “The fact that Colorado outperformed the nation in Q1, that’s not a big shocker. But the fact that we grew (2.9%) when the nation fell 1.6%, I think that magnitude of difference is a nice, positive surprise for Colorado.”

Lewandowski said the preliminary estimate of a decline for Colorado in the second quarter would not be surprising.

“We’re not completely decoupled from the nation, so as the nation goes, to some extent, the states should go,” Lewandowski said, noting that only 10 states posted positive GDP growth in the second quarter.

National and state GDP are estimates of economic output and are subject to several revisions, so it’s likely that the second-quarter estimate also will be revised