2022 GDP

Gross Domestic Product (GDP) reached a level of $730,072.6 million in 2022. Real (inflation-adjusted) GDP increased by 3.8 percent over the 2021 level. This growth in 2022 will represent the second full year of growth since COVID19.

For 2022, first quarter GDP increased by an annualized real rate of 2.9 percent. During the second quarter, GDP decreased by an annualized real rate of 0.4 percent. In the third quarter, GDP increased by an annualized real rate of 2.7 percent. In the fourth quarter of 2022, GDP increased by an annualized real rate of 3.7 percent.

2022 Highlights

For 2022, there were two big stories that played out over the year. First was the first and second quarter declines U.S. GDP. In the first and second quarters of 2022, U.S. GDP declined by 1.6 and 0.6 percent, while North Carolina real GDP bucked the national trend by increasing in the first quarter by 2.9 percent and decreasing in the second quarter by only 0.4 percent. The decline in U.S. GDP occurred because of the emergence of the Omicron variant in the first quarter but continued on through the second quarter as supply chain problems persisted in many sectors of the economy. In addition, the first and second quarters experienced an unprecedented decline in productivity, with first quarter 2022, labor productivity declining by 6.0 percent and second quarter, labor productivity declining by 3.7 percent. So in the first half of 2022 we saw current dollar GDP increased by 6.6 and 8.4 percent, because consumers and businesses spent 6.6 and 8.4 percent more on goods and services, but because of inflation, productivity declines, and supply chain issues the increase in current dollar spending resulted in a decline of actual goods and services delivered.

The other big issue going forward was the impact that inflation has had and is continuing to have on both the U.S. and North Carolina economies. This problem is compounded by Federal Reserve policy of rapidly raising interest rates, and the uncertainty about future Fed policy and rates.