The second quarter did not report good numbers for Indiana’s economy. Amid all the disruptions to life that the coronavirus pandemic has caused, many businesses have closed their doors. The U.S. Bureau of Economic Analysis reports that the real gross domestic product in the state declined to about 33%. Examining the state’s economic output has exposed a marked decline.
In the first economic quarter of 2020, Indiana posted a GDP of $381.9 billion. By the time the reports from the second quarter, which spanned from April to June, came about, Indiana’s GDP dropped to $344 billion. The second quarter’s GDP in 2020 was down by 9% from what it was at the same time just one year prior.
An industry that was responsible for most of the state’s decline was that of durable goods manufacturing. In the durable goods manufacturing sector, there was a decrease in output by about 6.74%. Manufacturing is a big business in Indiana, and when the pandemic hit, production and supply chains were severely affected. Even before the pandemic hit the United States, it was in China. Manufacturers dependent on goods coming from China began to feel the disruption in their ability to produce goods because of the stoppages and difficulties happening overseas.
Once the coronavirus came to the United States, many plants, including those in the state of Indiana, temporarily suspended operations. While manufacturing took a hit, it was not the only industry to be affected by the virus. The sectors of healthcare and social assistance declined by 4.48%. Non-durable goods and manufacturing also fell to 2.65%. The only increase in output was seen in the finance and insurance sectors at .76%.
How Does Indiana Compare to the Rest of the Nation?
When examining all the states in the nation and the amount of decline each is experiencing, Indiana comes in at 37. The state that saw the worst decline in GDP was Hawaii at 42.2%. The state that experienced the lowest amount of decline in GDP was Delaware at 21.9%. As a whole, every state in the nation experienced a decline in real GDP in the second quarter. The response to the virus was cited as the common reason that all states fell to some extent.
The leading industries across the country that were hit the hardest by the response to the virus were:
- Food services saw a decline nationally of 88%
- Healthcare and social assistance declined nationally by 48.1%
- Durable goods manufacturing declined nationally by 43.3%
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