Columbus economy jumps past Cleveland

Columbus now has the second-largest economy in the state.

Central Ohio’s gross domestic product — the value of goods and services produced in the region — grew at a 2.5 percent rate in 2016, pushing the size of the economy past Cleveland’s, according to federal data released this week. Cincinnati is No. 1. The growth rate for central Ohio was stronger than the 1.7 percent growth rate posted by the average U.S. metropolitan area’s economy and the 1.5 percent growth rate for the overall U.S. economy last year.

“It is good news. It is something we watch constantly,” said Kenny McDonald, chief economic officer for economicdevelopment group Columbus 2020, referring to the region’s growth rate.

He said Columbus consistently scores in the top third among its 34 peer metro areas, with populations of 1 million to 3 million.

“We have to keep after the retention and growth of companies in high-value manufacturing and services,”

McDonald said. “We have got to be relentless in the pursuit of that to maintain that and jump up a bit and stay ahead of the national average.”

Columbus’ GDP stood at $130.8 billion to rank 29th in the U.S.

The Cincinnati economy also grew at a 2.5 percent rate. That economy ranked 28th in the country with a GDP of $132 billion.

Cleveland’s was 30th at $129.4 billion.

It was no surprise that Columbus passed Cleveland, said Ben Ayers, senior economist at Nationwide.

For the past several years, the Columbus economy has been growing faster than Cleveland, and other data, such as total number of jobs in central Ohio, show Columbus already has topped Cleveland.

“It’s part of a longerterm trend,” he said. “Columbus has slowly been catching up with Cleveland.”

Akron had the highest growth rate in the state last year, growing at a 4.6 Cincinnati Columbus Cleveland

$132B $130.8B $129.4B +2.5 +2.5 +0.6 percent clip. Otherwise, all the other state metros showed barely any growth or even declined.

“Certainly, it would be better if more areas participated in the growth to the same degree Columbus and Cincinnati are,” Ayers said.

While it would be nice if more metro areas showed better growth, it is not realistic, McDonald said.

“If I look at any big, diversified state, there is a big difference in performance across the state,” he said.

In 2015, the growth rate for metro areas and for the U.S. as a whole was 2.9 percent. Lower oil prices and slowing manufacturing growth get much of the blame for the slower growth.

On the other side, cities heavy into technology — San Jose, California; San Francisco; Raleigh, North Carolina; Austin, Texas; and Seattle — did well. As was the case in 2015, last year’s growth in central Ohio was driven by two categories: One is the category that includes finance, insurance, real estate and rental-and-leasing. The second category covers professional and business services.

The first sector is being driven by a surge in apartment building in the region to serve the growing population, Ayers said. The second is tied to an increase in establishing and developing businesses in the region.