California is an economic powerhouse, nationally and globally.

• In 2025, California’s GDP was $4.3 trillion, comprising 14% of national GDP ($30.7 trillion). Texas and New York are the next-largest state economies at 9% and 8%, respectively.
• California’s economy ranks fourth internationally as of 2024, behind the US, China, and Germany. On a per capita basis, California’s GDP is greater than all of these countries.
• California’s economy grew relatively fast in the second half of the last decade, but it has slowed since (4.1% annually from 2015–2019; 3.0% from 2020–2025). By comparison, Florida (5.4%) and Texas (5.0%) have grown faster than California since 2020.
• Over the past 25 years, California’s economy has grown faster than the nation overall (90% vs. 69%) but not faster than other large states like Texas (130%) or Florida (101%). However, on a per capita basis, California’s economic growth has outpaced all other large states over the long term.

Technology has grown over time, but real estate, manufacturing, and health care are still big.

• Private industry comprises 90% of California’s GDP, up from 84% 25 years ago. Government makes up the remaining 10%, down from 16%.
• Real estate and finance are the largest contributors to the state’s GDP (17%), which has been the case for more than 25 years. Professional services and information grew substantially over that time—driven primarily by tech—and are now 17% and 15% of GDP, respectively. Manufacturing is the fourth largest contributor to California’s GDP (10%).
• Health care is among the fastest-growing sectors, making up 7% of GDP in 2025. It is also the largest sector statewide in terms of businesses (44%) and jobs (18%).

Job and business growth has powered the state’s economy.

• California’s labor market has grown by almost 3 million jobs (20%) since 2005, and the number of businesses with paid employees has grown more than 52%. Both outpaced population growth (9.8%), leading to robust gains in economic output.
• Labor force participation for Californians age 16 and older is 62.8%, down from a peak of about 67% in the early 2000s; this shift is due primarily to an aging workforce. Most workers earn wages or salaries (89%), but 2.2 million are self-employed as business owners, independent contractors, or gig workers.
• Over the past 25 years, California’s employment growth has been similar to national growth (0.8% vs. 0.7% annually); since 2019, employment growth has slowed in California (0.5% vs. 0.7% in the US).
• Unemployment is typically a bit higher in California (averaging 6.9% on an annual basis since 2001) than in the US (5.7%). In the past two years, unemployment has been well below historical averages: 5.4% in California and 4.1% in the US.

California’s economy varies widely across regions.

• In 2024, the Bay Area’s per capita income was $133,000, over $70,000 more than the Northern, Central Valley, and Inland Empire regions. In 2000, regions had at most a $46,000 difference in per capita income.
• Growth in the professional services and information sectors is a driver of these regional patterns. Professional services has increased most in the Bay Area, where it is the most common employment sector; it is also a major employer in San Diego, Orange, and Los Angeles Counties.
• Wages are higher in coastal urban areas; in 2024, the median wage was $37/hour in the Bay Area and $30 in San Diego County, compared to $23 in the Northern region and $22 in the Central Valley and Sierra region.
• The cost of housing and living is higher on the coast, contributing to larger shares of Californians who are working but experiencing poverty (from 8% in LA to 4% in the Sacramento region, for those working full time).

Global and national forces shape—and are shaped by—California’s economy.

• Inflation spiked at 9% in mid-2022, driven by pandemic challenges. In the two decades prior to the pandemic, inflation averaged 2.1%. By March 2026, inflation stood at 3%.
• California produces 9% of the nation’s international exports of goods ($188 billion in 2025) and 19% of its exports of services ($193 billion in 2023). It exports 21% of US agricultural products and 18% of computer and electronic products. Top export markets include Mexico (19% of goods exports), Canada (9%), and Taiwan (7.6%). California imports $76 billion in goods from China; Taiwan is next at $63 billion.
• Foreign businesses maintained an estimated 20,000 establishments in the state in 2026, generating around 850,000 jobs. About half of these jobs are in manufacturing or professional services. Firms based in Japan, the United Kingdom, and Canada are most common.