Industry Diversification Project Reports

The Naples-Immokalee-Marco Island seasonally adjusted IDI decreased in the third quarter of 2023, with an IDI of 5.309 — a decrease from both the second quarter of 2023 and the third quarter of 2022 (revised at 5.317 and 5.325, respectively). The IDI has followed a declining pattern since the beginning of 2020. Despite these consistent declines, the Naples-Immokalee-Marco Island MSA remained toward the top of the rankings, measured as the third most diversified MSA in the state for the quarter.

The seasonally adjusted IDI measure in the third quarter of 2023 continued a general downward trend for the MSA that began in the 2nd quarter of 2020. The decrease in IDI for the latest quarter was fueled by quarterly decreases in employment for the majority of the sectors in the MSA. The leisure and hospitality sector, one of the three largest industries in the MSA, fell 8.2 percent from the prior quarter.

The only quarterly increases were seen in the professional and business services, public administration, and manufacturing industries (increasing 0.4, 0.4, and 1.5 percent, respectively). The largest decreases were seen in the natural resources and mining, leisure and hospitality, and information industries (slipping 16.8, 8.2, and 6.5 percent). The natural resources and mining industry also saw the largest year-to-year decline (13.8 percent), while the manufacturing industry saw the largest year-to-year improvement (5.1 percent).

The Punta Gorda seasonally adjusted IDI in the third quarter of 2023 was 4.817, an increase from the last quarter (revised at 4.778), and an increase from the same quarter last year (4.782). 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 82.1 percent of the employment in the MSA and the top three accounting for 60.9 percent. For comparison, the top three industries in Cape Coral-Fort Myers MSA and Naples-Immokalee-Marco Island MSA account for 55.5 and 55.3 percent of total employment, respectively.

Historically, the 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 392 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 60.9 percent of total employment in the third quarter of 2023. These permanent residents help support these industries throughout the year, as opposed to the Cape Coral-Fort Myers MSA and Naples-Immokalee-Marco Island MSA.

¹ Source: U.S. Census Bureau, 2022 American Community Survey 5-year estimates, Table B01002: Median Age by Sex

The seasonally-adjusted IDI for the Southwest Florida workforce region—comprising Charlotte, Collier, Glades, Hendry, and Lee counties— increased from the second quarter of 2023. The workforce region’s seasonal IDI measured 5.240 in the third quarter of 2023, an increase from the previous quarter (revised at 5.227), and also from the third quarter of 2022 (5.212). The region jumped one spot to the seventh most diversified workforce region in the state (out of 24 total regions).

The region’s seasonally adjusted IDI has increased since the third quarter of 2022. This rise in IDI can be attributed to growth in some of the smaller industries (such as construction, manufacturing, and information) outpacing growth in some of the larger industries (such as trade, transportation and utilities and leisure and hospitality). The largest yearly increase was seen in the construction industry (8.5 percent increase), while the largest yearly decrease was seen in the natural resources and mining industry (8.1 percent decrease).

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.

Florida’s workforce experienced a small increase in the seasonally adjusted IDI during the third quarter of 2023. Florida’s seasonal IDI measured at 5.231, up from both the previous quarter (revised at 5.229) and the third quarter of 2022 (measured at 5.226). Florida was the 22nd most industrially diversified state in the third quarter, behind South Carolina (5.238) and ahead of Nevada (5.221). The highest seasonal IDI for the third quarter of 2023 was Washington (5.757) while the lowest IDI in the nation belonged to Mississippi (4.882).

Over the past four quarters, the state has seen an increase in employment in some of its larger industries – education and health services industry (increased 4.7 percent) and leisure and hospitality industry (increased 2.9 percent). All other industries in Florida, except for natural resources and mining (decreased 5.6 percent), saw increases in employment over the past four quarters.