Business

State economy expands at a strong pace

The state economy grew at warp speed in the last three months of 2013, driven by strong employment growth, rising incomes, and improving consumer spending, according to a new report released Thursday morning by the University of Massachusetts.

The Massachusetts economy expanded at an annual rate of 5.5 percent from October through December, the report said, compared to a 3.2 percent for the national economy.

Despite the strong economic growth, Massachusetts’ unemployment rate of 7 percent in December remains higher than the national average of 6.7 percent the same month.

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The state economy “appears to be benefitting from improving conditions in national and international economies, and by increasingly confident households who are demonstrating a willingness to spend,” said Northeastern University economics professor Alan Clayton-Matthews, who compiles and analyzes the data for the report.

The report also said the “rising tide is not lifting all boats,” citing problems among the long-term unemployed, or those who have been unable to find a job six months or longer, high jobless rates among young people and those with less education.

The report appears in MassBenchmarks, a journal of the UMass Donahue Institute in collaboration with the Federal Reserve Bank of Boston.

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