California’s economy, as measured by gross domestic product, did surprisingly well in the first year of the second Trump administration.My trusty spreadsheet looked at the Bureau of Economic Analysis’ tally of business output growth for the states and found that California’s GDP was up 2.4% for 2025.
That was the 11th-best performance among the states and topped the 2% expansion of the national economy.
California’s outperformance seems odd when the White House’s “America First” business thinking collides with California’s global focus. California consumer confidence, for example, hit a five-year low last year.
President Donald Trump’s second administration has featured some unorthodox economic tactics. Trade wars, fueled by steep tariffs and an immigration crackdown, have jolted businesses.
The top state economies for GDP growth in 2025 were Massachusetts (3.3%), Kansas (2.9%) and South Dakota (2.9%).
There were two decliners: the District of Columbia (off 2.4%) and Maryland (off 0.1%), both suffering from Trump’s steep cuts to federal government staffing.
As for California’s key rivals, the Texas economy grew 2.4% last year, ranking 13th among the states. Florida was up 2.7%, ranking 8th.
1st term
Contemplate that 2025’s economy was significantly slower than the overall business pace of Trump’s first presidency, which saw a major business upswing that was dulled by the pandemic’s outbreak in 2020.
Consider the swift GDP pace between 2017 and 2020, California’s economy averaged 3.9% annual growth — No. 5 among the states vs. 2.5% nationally.
Top performers were Idaho, averaging 5.8% GDP growth per year; Utah, at 5.4%; and Washington state, at 4.8%. There were three decliners: Hawaii (down 1%), Alaska (down 0.3%) and Louisiana (down 0.04%).
The Texas economy grew at a 3.4% pace in Trump’s first presidency, not the best, while Florida was up 3.3%, No. 11.
Globally speaking
The world’s economic gyrations make it tricky to put California’s economic might into a global perspective.
There’s no perfect yardstick of worldly business heft. Even the often-used benchmark — gross domestic product, a broad measure of business output — is subject to various swings, including currency changes and numerous statistical revisions.
Nonetheless, my trusty spreadsheet used two recently updated GDP figures to calculate the theoretical world in which California — the nation’s largest business output — is tracked as a stand-alone economy on the global stage.
State-level GDP figures from the Bureau of Economic Analysis were compared with the International Monetary Fund’s worldwide estimates of economies over the past 10 years. The business output was tracked in U.S. dollars and was not adjusted for inflation.
Here’s what this vanity scorecard tells us.
The world’s top two economies have been the same for 10 years. For 2025, the U.S. was No. 1 at $30.77 trillion, followed by China at $19.63 trillion.
Germany has been No. 3 for the past three years, with $5.05 trillion of business output last year.
Japan, the previous No. 3, was the world’s fourth-largest economy by this GDP metric last year at $4.44 trillion.
Then, California ranked No. 5, with an average GDP of $4.3 trillion in 2025. California has been the world’s fifth-largest economy for all 10 years tracked.
After California, the United Kingdom came in sixth at $4 trillion, followed by India at $3.92 trillion.
So what about 2026?
The International Monetary Fund projects the same top three: The U.S. ($32.38 trillion), China ($20.85 trillion) and Germany ($5.45 trillion).
Japan’s estimate for this year is $4.38 trillion, the United Kingdom’s is $4.26 trillion and India’s is $4.15 trillion.
What about California?
Well, if the state’s economy can grow at the same pace as the International Monetary Fund’s 2026 estimate for the entire U.S., California’s GDP would finish 2026 at $4.52 trillion.
That would make the Golden State the world’s fourth-biggest economy on this bragging rights yardstick.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com.