Mass. economy grows at healthy clip, outpacing US

By Megan Woolhouse, Globe Staff

The Massachusetts economy continued to expand at a healthier clip than the nation’s in the first half of 2011, according to state and federal reports released today.

The University of Massachusetts said today that the state’s economy grew at an annual rate of 4.3percent on the second quarter, more than three times faster than the national economy, which expanded at just 1.3 percent during the same period. The state’s economy has outperformed the US economy for four successive quarters, according to the report, published by the UMass Donahue Institute in collaboration with the Federal Reserve Bank of Boston.

The UMass analysis found strong job creation in the first half of this year in the state, citing the addition of 41,300 jobs, according to a federal survey of state payrolls, and a drop in the Massachusetts’ unemployment rate. The state’s unemployment rate fell to 7.6 percent in June, down from 8.3 percent at the end of last year.

Northeastern University professor Alan Clayton-Matthews, one of the report’s authors, cautioned that the report may overstate the state’s growth by as much as one percent and that the data used is subject to revision. Clayton-Matthews also noted that a separate survey of households estimated that the number of employed residents in Massachusetts state grew only by about 16,000 in the first half of the year and that the drop in the unemployment rate was due to the large volume of people who had stopped looking for work.

Even if the state’s numbers were revised downward, the state’s economy has still outperformed the nation’s. The report also predicted that the state’s economy would continue to recover from the recession, with strong growth of 4.7 percent in the third quarter and 4.3 percent in the fourth.