California's economy has exceeded Japan's, making the Golden State the fourth-largest economic power in the world, among other countries.
California's nominal GDP in 2024 was $4.10 trillion, per the Bureau of Economic Analysis, overtaking Japan's $4.03 trillion in the same period, per the International Monetary Fund. Robust economic sectors and productivity have fueled the state's growth.
"California isn't just keeping pace with the world—we're setting the pace," Gov. Gavin Newsom said in a press statement announcing the ranking on April 23. "Our economy is thriving because we invest in people, prioritize sustainability, and believe in the power of innovation."
Three countries rank higher than California in GDP: the United States with $29.18 trillion, China with $18.75 trillion, and Germany with $4.66 trillion. But California's GDP grew faster than all three in 2024 at 6%, compared to the overall US economy at 5.3%, China at 2.6%, and Germany at 2.9%.
Despite an affordable housing crisis in California that is contributing to a net increase in residents moving out of state, California's population is still growing in large part due to immigration and natural birth rates.
California continues to be a leader in industries like tech and agriculture. Twenty percent of all Californians are employed in the tech sector, per a report published in June and commissioned by the California Foundation for Commerce and Education. And California is the country's largest agricultural exporting state shipping $24.3 billion worth of food commodities in 2023.
Additionally, the state contributes $83 billion more in federal taxes than it receives in federal support, per the Rockefeller Institute of Government. On April 16, Newsom and California's State Attorney General Rob Bonta filed a suit against the Trump administration seeking to end its tariff policies, which they say hurt the country's overall economy.
"Our progress is threatened by the reckless tariff policies of the current federal administration," Newsom continued in the press statement. "California's economy powers the nation, and it must be protected."
Do you have a story to share about leaving California for a place with cheaper housing? Contact this reporter at jdeng@insiderbusiness.com.
