The U.S. economy is famous for being consumer focused, with personal consumption expenditures accounting for about 70 percent of the country's gross domestic product (GDP). Compared with other economies, it is also a fairly closed one—exports' share of GDP is only about 13 percent. For many Americans, the phrase "international trade" is synonymous with "trade deficit" since the country for decades has imported more than it sold abroad. And although the aforementioned facts are perfectly true, they are masking an important and growing phenomenon—the U.S. economy's increasing reliance on foreign demand. So here's another fact: exports have become a potent engine of the current economic recovery, having contributed 45 percent to U.S. GDP growth since the end of the last recession—more than in any recent economic recovery.
Last year, the United States exported about $2.1 trillion in goods and services. Exports of services, such as consulting and other business services, accounted for about 30 percent of U.S. exports. (The United States is the largest exporter of services in the world.) The rest—about $1.5 trillion—were U.S.-made goods, industrial materials, and agricultural products, also known as "merchandise exports." Last week, the U.S. Department of Commerce released the report that showed a breakdown of U.S. merchandise exports by U.S. metropolitan areas for 2011. The report is based on the U.S. Census Bureau's Origin of Movement–ZIP code Based Series, which allocates exports to states and localities based on the address of the legal entity, such as a manufacturer, that receives the benefit from the export transaction.
The data for merchandise exports are now available for the 367 metropolitan statistical areas (MSAs), although the value of those exports is concentrated in the top MSAs. In the Sixth District, five MSAs showed up on the top-50 list: Miami-Fort Lauderdale-Pompano Beach (#5), New Orleans-Metairie-Kenner (#15), Atlanta-Sandy Springs-Marietta (#18), Tampa-St. Petersburg-Clearwater (#38), and Nashville-Davidson-Murfreesboro-Franklin (#45). Together, just these District MSAs alone accounted for about 7 percent of the country's merchandise exports last year.
The Miami metropolitan area is by far the largest exporter in the District. In 2011, it exported $43 billion worth of merchandise, accounting for two-thirds of Florida's merchandise exports. Miami's exports are dominated by computer and communications equipment and are shipped mainly to Latin America. For Florida's second-largest exporter, the Tampa metropolitan area, computer and electronic products were also the dominant export, but Tampa's export destinations were a bit more diversified across continents—in addition to Latin America, a big share of Tampa's exports sold in Canada, India, and China. Miami and Tampa are also big exporters of transportation equipment.
The Sixth District's second-largest exporter, the New Orleans metropolitan area, stood out in 2011 as the metropolitan area that recorded the highest exports growth in 2011 among the top 25 metropolitan exporters. Exports from New Orleans soared more than 45 percent between 2010 and 2011, boosted to a large degree by higher shipments of petroleum products. Top export destinations for the New Orleans area last year were Japan, China, Mexico, Singapore, and the Netherlands.
Somewhat surprisingly, Singapore—a small city-state—is also the third-largest export destination (our neighbors in North America took the first and second place) for goods produced in the Atlanta metropolitan area—my former hometown. Atlanta's exports are concentrated in transportation equipment and machinery. And finally, the Nashville metropolitan area (which happens to be my new hometown), which is known for its auto industry, relies on exports of transportation equipment, as autos and parts follow the NAFTA supply chains.
Overall, the latest MSA export data clearly show that a lot of products made, extracted, or grown in the Sixth District's largest MSAs end up in foreign countries. So, no wonder the latest slowdown in global growth has become a concern for many of the region's businesses.
By Galina Alexeenko, director of the Regional Economic Information Network at the Atlanta Fed's Nashville Branch