CLEVELAND, Ohio – If population growth defines success, Greater Cleveland likely never will compete with the Sun Belt.
But if the quality of the local economy is what is at stake, Cleveland might already be ahead of many hot places to the south.
Year after year since the recession, slow-growth Rust Belt metro areas have whipped the fastest growing areas of the Sun Belt in one measure a researcher at Cleveland State University argues should draw more attention as a benchmark for success – economic output on a per capita basis.
In Part 2 of cleveland.com’s Building from Strength series, we examine how Cleveland stacks up to some of the nation’s fastest growing places when it comes to per capita gross domestic product – the value of all goods and services produced.
The idea behind Building from Strength is simple: Picking the right path forward means understanding the strengths in hand.
“There is no correlation between levels of prosperity and population growth,” said Richey Piiparinen, director of urban theory and analytics at CSU’s College of Urban Affairs. “You have these fast-growing cities that are just living off their local economy … consumption activity.”
Here is a comparison of per capita gross domestic product for the Cleveland metro area to the seven fastest growing of the large metro areas nationally from 2001 through 2018: Phoenix, San Antonio, Las Vegas, Orlando, Charlotte, Austin and Houston.Rich Exner, cleveland.com
Piiparinen discovered the positive note for Cleveland and other once industrial-driven northern economies in digging into the first-ever release of county-level gross domestic product data from the U.S. Bureau of Economic Analysis.
Some highlights:
* In the CSU study of 14 large metro areas, including Cleveland, the per capita GDP for the Sun Belt edged $1,400 higher than the Rust Belt by the start of the recession in 2007. But since then the Rust Belt has done consistently better, and now has an advantage of $59,073 to $54,604 over the fastest-growing Sun Belt metros.
* Cleveland metro area’s per capita real GDP increased from $49,280 to $58,010 during this same time period, now ranking 70th among 384 metros nationally. Cincinnati is 81st and Columbus is 96th. For Cleveland, this covers Cuyahoga, Geauga, Lake, Lorain and Medina counties.
* In the core counties for Ohio’s big metros, GDP per capita is even higher - $66,013 for Franklin County (Columbus), $71,325 for Cuyahoga County (Cleveland) and $82,012 for Hamilton County (Cincinnati).
* Though Cuyahoga County ranked near the bottom for population change (474th among the 500 largest counties nationally), it ranked 88th for annual GDP growth per capita of 1.92% from 2000 to 2018, outperforming many faster growing places.
* Among places where the GDP grew at a slower rate per capita are the home counties for Charlotte (1.54%), Phoenix (1.15%), and regionally Pittsburgh (1.55%) and Indianapolis (minus 0.75%). Even Nashville (2.18%) is just a little ahead of Cleveland.
The Sun Belt metros for this comparison were the seven fastest growing metro areas for population among the 40 largest nationally: Austin, Charlotte, Houston, Orlando, Phoenix, Las Vegas and San Antonio. The metros ranking lowest for population change among the top 40 fell into CSU's classification for Rust Belt: Cleveland, Detroit, Chicago, Pittsburgh, Providence, Milwaukee and St. Louis.Rich Exner, cleveland.com
Why GDP per capita
“The GDP per capita is the most accepted measure for standard of living that economists have come up with,” Piiparinen said. “As doctors look at life expectancy, economists look at GDP per capita.”
Piiparinen, writing in the draft of his upcoming paper: Ohio: The Future of Growth, points to theories from other researchers to support his suggestion that Cleveland be judged more by the quality of its economy than population change.
“What makes a place successful? The answer depends on the definition of success,” Piiparinen writes.
Quoting urban researcher and author Richard Florida’s writings in the Atlantic: “A rising population can create a false illusion of prosperity, as it did in so many Sun Belt metros, which built their house of cards economies around housing construction and real estate development. … But America’s economic winners are the places that have improved their productivity.”
Piiparinen said this is where places like Cleveland and Ohio’s other big metro areas have an advantage over many places in the Sun Belt.
“They are going to have to figure out ways to grow their GDP beyond sheer quantity,” Piiparinen said. “We’ve learned how to do that.”
In part 1 of Building from Strength, cleveland.com focused on the sheer size of the economies that remain in Cleveland and Ohio’s other big cities. Cuyahoga’s annual GDP is larger than those of 13 states.
Next, Building from Strength will examine what sectors still are driving the economic output of Cleveland and Ohio – offering a solid base for future growth.
Rich Exner, data analysis editor for cleveland.com, writes about numbers on a variety of topics. Follow on Twitter @RichExner. See other data-related stories at cleveland.com/datacentral.
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