Kenan Institute economist tracks economic growth

A new ranking pops up on your social media feed daily. Top cities for job creation. Best areas for housing. The national leaders in population growth.

Many statistics track economic health, but what if one ranking system took everything into account?

That’s the thinking behind the Kenan Institute of Private Enterprise’s Empowering American Cities research project, a collaboration with Fifth Third Bank.

“Our model combines all those things,” said Gerald Cohen, the institute’s chief economist and research professor at UNC Kenan-Flagler Business School.

It offers a gross domestic product growth forecast for the country’s 150 most populous extended metropolitan areas — accounting for nearly 90% of the national economy — from New York City to Wilmington, North Carolina

Cohen answered questions about the project, its findings and our region’s strong performance.

What’s the purpose of this research?

We’re providing models that allow us to understand current conditions and predict future conditions by incorporating different statistics into a broader measure of economic activity. We built a model so we can say something about 2024, which data isn’t available now, and make a forecast for 2025. We’re aiming to understand the drivers of that growth. For instance, “Why is the Triangle one of the fastest-growing economies in the country?”

Why does the Triangle have that status? The Raleigh-Durham EMA ranks fourth for GDP growth in this model.

We’ve been a consistent outperformer.

We have a combination of people moving here and strong productivity growth, and that’s because of the industry mix we have. Here you have people who come and are highly skilled and more productive as a result. We’re growing in industries like biotechnology and technology in general. That’s what’s driving growth and the key to our performance.

There are great universities — one is far superior — and we attract talent. We also retain talent. People move here for school and then stay, starting companies or working for startups. You see all these startups and spinouts from universities.

Who uses this research and how?

We’ve had a lot of economic development folks say, “Oh, this is really interesting. What things can we do to attract and retain talent?”

I was in two cities — Nashville, Tennessee, and Columbus, Ohio — both promoting a tax that was going to transit. I said, “Our research suggests having public transportation is really beneficial to attracting and retaining people. That’s one of the drivers of economic activity.”

Businesses trying to make decisions will also use the information to answer questions like, “Should I expand in this region? Should I be looking at different regions? What are the types of people in our community?”

Is there an example of data and public perception not matching up?

I think the Bay Area is a great example. Everybody loves to hate San Francisco. Everybody talks about crime and companies leaving. Still, they are one of our top-performing EMAs. The Bay Area is much broader than San Francisco. In fact, the Bay Area includes San Jose, which is actually bigger than San Francisco.

They’ve had very modest job gains, so why are they growing so quickly? Because of the productivity of that job creation. The people in tech are creating a lot of economic activity output. I think that’s a great example of an area that everybody loves to hate, and yet it’s actually been a consistent outperformer.

Who at the institute led this work?

I have a great team. The research initiatives team deserves all the credit for making me look good. Cody Morris is the key modeler, but it’s really a team effort.