Could California lose its bragging rights as the world’s fifth-largest economy?
My trusty spreadsheet found that the Golden State could fall one notch in 2024 to fast-growing India in this theoretical ranking of economic heft, as measured by Gross Domestic Product – a broad measure of business output.
Let’s start by noting that California businesses produced $3.86 trillion worth of goods and services in 2023, as tracked by the US Bureau of Economic Analysis. Now, we’ll put that into a global perspective using figures from the International Monetary Fund.
In 2023, only four national economies were larger than California, by GDP math – the US at $27 trillion (that’s with California included), China at $17.7 trillion, Germany at $4.4 trillion, and Japan at $4.2 trillion.
But India wasn’t very far behind the Golden State in 2023 at $3.7 trillion. Then came the United Kingdom with a $3.3 trillion GDP and France at $3.1 trillion.
Next, we’ll peek at the IMF’s forecasts for 2024. India’s economy is projected to produce $4.11 trillion of goods and services this year. The US GDP in estimated to be $28 trillion.
So, if California produces the 14.5% share of US output it has averaged during the past two years, the Golden State would have $4.05 trillion in GDP in 2024.
That would translate to California falling just behind India – a nation with 1.4 billion residents, 36 times the Golden States’ population. Still, California would remain ahead of the United Kingdom, forecasted to be at $3.6 trillion, and France at a projected $3.2 trillion.
Not that California becoming “the world’s sixth-largest economy” is a shabby status, if it happens. But the potential demotion should serve as a reminder that California is constantly pushed to maintain its long-running standing as an economic leader – nationally and globally.
Slow year
Yes, 2023 was a tepid year for California’s business climate.
The statewide economy expanded by 2.1%, after…
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