IDP Reports

The Regional Economic Research Institute first developed the Industry Diversification Index in Spring of 2016 and updates it on a quarterly basis.

Researchers and academics are encouraged to contact the RERI to request access to the data for use in academic studies and modeling. The IDI begins in 1990 and is computed for each Florida metropolitan statistical area, each Florida workforce region, and each U.S. state. Upon request, the RERI will compute it for any MSA in the United States.

SECOND QUARTER, 2025 - (Vol. 10, No. 2)

The seasonally-adjusted IDI in Southwest Florida slightly decreased to 5.180 in the fourth quarter of 2024, ranking 5th out of all 21 workforce regions.

The Naples-Marco Island MSA was the fourth most industrially diversified MSA in the state (out of 22 total MSAs). Moreover, the Cape Coral-Fort Myers MSA and Punta Gorda MSA ranked 12th and 19th in the state, respectively.
Industry diversification for Florida decreased slightly to 5.212 for the fourth quarter of 2024, falling to 23rd out of 50 states.

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The seasonally adjusted Cape Coral-Fort Myers FGCU Industry Diversification Index (IDI) decreased in the fourth quarter of 2024, registering at 5.066. This was down from both the fourth quarter of 2023 (revised to 5.104) and the third quarter in 2024 (5.076). The MSA stayed as the 12th most diversified MSA in the state, out of 22 total MSAs in Florida. The index registers between 0 and 10, with 0 being the least diversified, and 10 being the most diversified.

Industrial diversification in the Cape Coral-Fort Myers MSA has gradually improved since 2012. The MSA saw quarterly increases in employment from two of its top three industries: Education and Health Services (up 4.4 percent) and Trade, Transportation and Utilities (up 2.2 percent), but saw a decrease in its third most popular industry: Construction (down 1.5 percent). Notably, employment in the Natural Resources and Mining sector fell 4.9 percent from the previous quarter.

Seasonality plays a significant role in the Cape Coral-Fort Myers MSA economy, as it is typical for the MSA to experience its lowest unseasoned IDI measures during the first and fourth quarters of the year, while having its highest unseasoned measures during the second and third quarters.

The Naples-Marco Island seasonally adjusted IDI registered at 5.247 in the fourth quarter of 2024 — a small decrease from both the last quarter (5.267) and same quarter last year (5.305). Despite the decline, the Naples-Marco Island MSA remained toward the top of the rankings, measured as the fourth most diversified MSA in the state for the quarter.

The seasonally adjusted IDI measure in the fourth quarter of 2024 continued a general downward trend for the MSA that began in the 2nd quarter of 2020. The jump and subsequent decline in industrial diversification can be attributed to the impact Covid-19 had on the Leisure and Hospitality sector in the MSA, which saw total employment drop 36 percent from the 1st to 2nd quarter of 2020. Employment in the sector has recovered since then and once again represented one of the largest industries in the 4th quarter of 2024.

The MSA also saw year-to-year improvements in its three largest industries – Education and Health Services (up 7.6 percent), Leisure and Hospitality (up 11.4 percent), and Trade, Transportation and Utilities (up 3.1 percent). Altogether, the top three industries in the Naples-Marco Island MSA represent 57.3 percent of total employment in the MSA, up 0.7 percentage points from a year ago.

The Punta Gorda seasonally adjusted IDI in the fourth quarter of 2024 was 4.736 — a small decrease from both the last quarter (4.784) and same quarter last year (4.778). The Punta Gorda MSA had the 19th highest IDI in the state of Florida, consistent with the ranking from the previous quarter and from the same quarter the previous year.

The MSA’s seasonal IDI continues to be the least diverse in Southwest Florida with the top five sectors accounting for 82.4 percent of the employment in the MSA and the top three accounting for 62.1 percent. For comparison, the top three industries in Cape Coral-Fort Myers MSA and Naples-Marco Island MSA account for 56.0 and 57.3 percent of total employment, respectively.

Historically, Punta Gorda MSA’s unseasoned IDI has exhibited less seasonal fluctuation than the other two coastal Southwest Florida MSA’s. Because the population in Punta Gorda has one of the highest median ages in the country (second highest median age out of 387 MSAs in the United States¹), the region remains highly concentrated in industries catered towards the elderly, with the Trade, Transportation, and Utilities, Education and Health Services, and Leisure and Hospitality industries accounting for 62.1 percent of total employment in the fourth quarter of 2024. These permanent residents help support these industries in the Punta Gorda MSA throughout the year.

¹ Source: U.S. Census Bureau, 2023 American Community Survey 5-year estimates, Table B01002: Median Age by Sex

The seasonally-adjusted IDI for the Southwest Florida workforce region²—comprising Charlotte, Collier, Glades, Hendry, Lee and Monroe counties—decreased slightly from the third quarter of 2024. The region’s seasonal IDI measured 5.180 in the fourth quarter of 2024, less than both the previous quarter (revised at 5.197) and the fourth quarter of 2023 (5.212). Despite the decline, the region improved to the fifth most diversified workforce region in the state (was previously 8th out of 21 total regions during the same quarter last year).

The region saw moderate year-to-year growth in Leisure and Hospitality (up 5.5 percent), Natural Resources (up 7.4 percent), Education and Health Services (up 5.8 percent) and Trade, Transportation and Utilities (up 2.2 percent) industries. The rest of the industries saw marginal changes, ranging between –1.1 and 1.7 percent.

Historically, the region typically experiences higher unseasoned index measures during the quarters spanning January through June, and lower index measures during the quarters spanning July through December. The higher index measures during the winter period can be attributed to an influx of tourism and seasonal residents, which leads to an increase in demand for both the Retail Trade and Accommodation and Food Service industries to meet the seasonal demand. In return, the increased seasonal demand in these industries create spillover effects for all of the other super sector industries in the region. In addition, the first two quarters of the year are associated with crop harvesting in the region, creating demand in all other sectors of the economy as well. During the second half of the year, there is a higher concentration in fewer industries driven by Construction, Professional and Business Services, Trade, Transportation and Utilities, and Education and Health Services.

[² Florida recently changed workforce region definitions in July 2024. See our white paper for more information on how this impacts our results: https://www.fgcu.edu/cob/reri/files/idr/idr2024q4-wfr-definition-change.pdf

Florida’s seasonal IDI measured at 5.212, slightly below both the previous quarter (revised at 5.222) and the fourth quarter of 2023 (measured at 5.230). Florida fell to the 23rd most industrially diversified state in the fourth quarter, slipping from 22nd in both the previous quarter and same quarter last year. The highest seasonal IDI for the fourth quarter of 2024 was Washington (5.708), while the lowest IDI in the nation belonged to Vermont (4.610).

Over the past year, the state has seen moderate improvements in employment for some of its larger industries – Education and Health Services industry (increased 4.6 percent) and Trade, Transportation, and Utilities industry (up 2.2 percent). Most other industries experienced increases in employment over the past year, apart from Construction (down 0.6 percent), Manufacturing (down 0.3 percent), Information (down 0.1 percent) and Unclassified (down 33.8 percent).