The Lehigh Valley’s Gross Domestic Product grew to a record $55.7 billion in 2023, with manufacturing continuing to be a leading driver. 
When factoring in inflation, the Lehigh Valley’s economy grew by 4% from 2022, faster than the state, the Northeast, and the nation. The data released by the U.S. Bureau of Economic Analysis (BEA) on Dec. 4 is the most-recent available, as GDP data lags by one year.
The growth in GDP coincides with the Lehigh Valley being named the No. 1 mid-sized market for economic development in 2023 by Site Selection magazine, an authority in the corporate real estate and economic development field. The ranking is based on the number of projects that meet criteria for size, job creation, and financial investment.
“The steady growth of the Lehigh Valley’s economy in recent years is a testament to what can be accomplished when the public and private sector work together,” said Don Cunningham, President and CEO of Lehigh Valley Economic Development Corporation (LVEDC).
“A GDP of more than $55 billion is an impressive number, but what’s more important is how that growth is driving up the quality of life for families. Wages are up. Household income is increasing. There are opportunities for everyone,” Cunningham said.
The Lehigh Valley’s economy is the 67th largest in the country, up from 68th in 2022. The region’s output exceeds that of three states – Alaska, Vermont, and Wyoming.
GDP measures the total market value of the goods and services produced by the private sector in the metro region that comprises Lehigh, Northampton, Carbon, and Warren (N.J.) counties. Lehigh and Northampton counties make up $47.7 billion of the metro output.
Manufacturing output rose to $9 billion, comprising 16% of the region’s GDP. That’s an increase from BEA’s adjusted 2022 figure of $8.2 billion. Production of non-durable goods, such as food and beverages and consumer and health products drove that growth.
Nationwide, manufacturing makes up 12% of GDP.
The Lehigh Valley is the 55th largest manufacturing market in the U.S., up one place from in 2022. It ranks among the top 15% of manufacturing markets in the nation.
The diverse manufacturing economy includes more than 700 companies producing a range of items such as semiconductors and other technology, medical and life sciences devices, food and beverages, consumer goods, and plastics, among others.
Other leading contributors to the region’s GDP in 2023 were: finance, insurance, and real estate; education, health care, and social assistance; and professional and business services.
Factors driving the Lehigh Valley’s economic growth include a growing population, which increases the workforce and provides companies with the skilled labor that they need to compete in a global economy. The region’s 11 colleges and universities and three career and technical schools are a pipeline of talent, graduating more than 11,000 students annually.
A workforce of 1.7 million lives within an hour’s drive, providing the talent that companies need.
Located within a day’s drive of one-third of U.S. consumers, and with access to regional ports and international airports, the Lehigh Valley’s location makes it easy for producers to get their goods to market.
The prime location and access to talent were among the reasons why Italian company Travaglini chose the Lehigh Valley for its first U.S. location, opening in Allentown in 2023.
“It was like an onion. Every time we peeled back a layer, we saw another advantage to choosing the Lehigh Valley,” said Daniele Negri, project manager at Travaglini, which designs equipment to cure meats and other delicacies.
Pennsylvania Gov. Josh Shapiro has held up the Lehigh Valley as a model for the rest of the state to follow when it comes to economic development. During several visits to the region this year, he heralded the Lehigh Valley’s public-private partnership approach for “getting things done.”
"This is a region on the rise, and it is all because you have all put together a plan in the Lehigh Valley and you have consistently executed it every step of the way," Shapiro said in January when he unveiled the state’s new economic development strategy at OraSure Technologies, which produces at-home tests for COVID-19 and HIV, among others, along with vaccines.
During a visit in May to award a grant for a manufacturing facility in Allentown, Shapiro said Pennsylvania was “betting heavy” on the Lehigh Valley to drive economic growth for the state. He said the region is “a place that knows how to band together and win.”