Regional Morsel: Southern comforts

The South’s economy has been growing rapidly with consumer spending strong in the third quarter and optimism for next year.

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David Tinsley

December 2023

Key takeaways

  • The South of the U.S., as defined by the Census Bureau, is a huge region of nearly 129 million people, covering 16 states and the District of Columbia (D.C.). Almost half of the population growth in the U.S. since 1960 has come from the South, supported by inward migration and a relatively high birth rate.
  • The South as a region outgrew the overall U.S. economy between 2017-22, according to GDP data from the Bureau of Economic Analysis. In 2023 the South's economic performance also appears robust, with Bank of America data suggesting solid consumer spending growth in the third quarter. Our data also suggests the smaller southern states have recently been performing well.
  • Can we expect a similar constructive performance into next year? Well, the southern consumer appears fairly upbeat according to the November 2023 Bank of America Market Landscape Insights Survey and the regional labor market is arguably in the best shape of any U.S. region. So, while the U.S. economy and consumer may experience a 'soft landing' in 2024, we see reason to be optimistic that the South could modestly outperform.

Read our full analysis for a more in-depth look at these trends.