Almost every week, a new round of strong economic data triggers a celebratory statement from the Biden administration. However, most of the top-performing states voted for former President Donald Trump, a new analysis from ABC News found.
An examination of key economic metrics — including job and income growth — found that an overwhelming majority of red states were among the 18 top performers.
The disparity between red and blue states had little to do with Biden's actions, experts interviewed by ABC News said, noting that federal policies typically have minimal influence on individual states' economic trends.
Rather, they added, the momentum is due in large part to the attractiveness of warm-weather states to workers and businesses, as well as the combination of business-friendly state policies and Democratic-leaning cities that attract young, educated workers.
“The climate is better in the red states and Americans like good climate,” Mark Partridge, a professor of economics at Ohio State University, told ABC News.
But some experts warn that the statistical snapshot of economic performance could be due in part to temporary, country-specific factors that could shift in the coming months or years.
Nationally, the economy performs well in almost every way. Inflation is falling, job growth is increasing and gross domestic product is proving much more resilient than expected following near-historic interest rate hikes.
Data shows attitudes toward the economy have improved in recent months. Consumer sentiment jumped in January but remained well below pre-pandemic levels, according to a University of Michigan survey.
“Since the President took office, he has enacted a series of historic legislative achievements that have directly fueled the historic labor market recovery and historic economic growth we have experienced,” said Daniel Hornung, deputy director of the National Economic Council. A Biden administration group advising the president told ABC News.
Additionally, Hornung rejected the idea that Biden's policies had little to do with the particularly strong performances of red states, pointing to legislative achievements that in some cases disproportionately benefited red states.
After the Inflation Reduction Act, which provided tax credits to incentivize private investment in clean energy, most new clean energy projects were located in districts represented by Republican House members, according to a September study by the advocacy group Climate Power.
“This is not something that is collected and concentrated in blue cities,” Hornung said. “It’s really spread out across the country.”
According to data from the US Bureau of Economic Analysis, five states are currently enjoying above-average performance in four key metrics analyzed by ABC News: job growth, personal income growth, gross domestic product growth and gas prices, according to Labor Statistics and AAA.
Four of those five states cast their votes for Trump in the 2020 election, including Idaho, Texas, South Carolina and Utah. The fifth, Wisconsin, went to Biden.
Thirteen states now have above-average performance in three of the four metrics. Nine of those states supported Trump, including Florida and Nebraska.
One of the top-performing states, Texas, is posting the third-highest GDP growth in the country, in part because the state added more people than any other last year, according to the U.S. Census Bureau. San Antonio, one of the state's largest cities, has an unemployment rate of 3.1%, below the national average of 3.7%, U.S. Bureau of Labor Statistics data shows.
KGBTexas, a marketing company based in San Antonio, has experienced rapid growth in recent years that reflects a citywide economic boom, Katie Harvey, the company's founder, told ABC News.
As the company gained new customers, Harvey quickly added new staff, growing from about 35 to 55 employees in three years, or nearly 60%, she said. The growth was made possible by an influx of people interested in the city's affordable housing, education and business sectors, Harvey added.
“We had the best three years in the history of our company,” said Harvey, who founded KGBTexas in 1994. “What has helped us grow is recognizing the positive things that are happening in this city.”
Yi-Chin Lee/Houston Chronicle via Getty Images, FILE
San Antonio, like most major cities in the country, voted for Biden in 2020. In fact, the counties Biden won account for about 70% of the nation's economic output, a 2021 Brookings Institution study found.
White House data shows that under President Biden, Texas has received about $120 billion in private sector investment in manufacturing, as well as $30 billion in public infrastructure and clean energy investments. For comparison, according to the US Bureau of Economic Analysis, Texas' GDP was $2.4 trillion in 2022.
The strong performance of red states could be due to the convergence of business-friendly state laws and attractive cities for young, educated liberals, Edward Glaeser, a Harvard economist, told ABC News. The skilled labor pool provides companies with a good source of labor, while companies benefit from government policies such as low taxes and right-to-work laws, he added.
“It’s just a very strong combination,” Glaeser said.
Simple Modern, a beverage maker in Oklahoma City, Oklahoma, has benefited from exactly these factors, Mike Beckham, the company's CEO, told ABC News.
The company nearly doubled its revenue last year, reaching nearly $180 million in sales, Beckham said. Two years ago the company had 60 employees; now there are 100.
A business-oriented state government has helped spur growth, Beckham added, pointing to a recently opened manufacturing facility.
“When you're trying to start up a factory, it's easy to get bogged down in red tape,” Beckham said. “That wasn’t our experience.”
At the same time, a relatively liberal electorate in the city pushed measures such as a sales tax referendum in 2008 that funded what would become the NBA's Oklahoma City Thunder arena, Beckham said.
“There are two sides to the story,” Beckham added. “And our community has benefited from both.”
To be sure, some economists cautioned that the evidence pointing to strong performance in red states, while indicative of a trend, does not suggest a sustained trend, which would require data over a longer period of time. Meanwhile, some experts noted that low gas prices in red states are often due to low taxes rather than favorable economic outcomes.
Furthermore, they added, the state's economic performance provides little insight into the consequences of Biden's policies.
“Presidents don't really have much to do with the state's economic performance,” Terry Clower, a public policy professor at George Mason University, told ABC News.
Instead, experts said the relatively good performance of red states was due in part to business-friendly policies and attractive weather.
“The warmer parts of America tend to do much better than the colder parts,” Glaeser said.
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