During the past decade, Americans have been spreading out, both geographically and economically, with this trend intensifying during the pandemic.
From 2012 to 2022, the states in the Northeast and Midwest regions experienced substantial reductions in their respective shares of the national gross domestic product, while in contrast, the Southeastern and Western states observed significant growth and improvement.
Some fast-growing states in the South, such as Florida and Texas, saw a positive percent change in the state's share of the national GDP, indicating that their economies have grown at a faster rate compared to the rest of the country. On the other hand, northeastern states have experienced weaker economic performance.
Drawing conclusions from Internal Revenue Service data, Bloomberg reported that the switch occurred during the pandemic when a surge in transplants helped bring new income to the Southeast amounting to $100 billion in 2020 and 2021. Conversely, the Northeast has suffered a loss of $60 billion within the same timeframe.
"For the first time, six fast-growing states in the South — Florida, Texas, Georgia, the Carolinas and Tennessee — are contributing more to the national GDP than the Northeast," according to the report. This trend is gaining momentum and it will probably continue to grow with the establishment of numerous electric-vehicle factories.
New technologies have the potential to transform the U.S. economy, and automakers are rushing to develop plants to make electric vehicles and the lithium-ion batteries that power them, with at least $65 billion in announced projects in the U.S. Most automakers are choosing southern states for their electric vehicle plants.