If you find it hard to believe that California\u2019s economy is doing OK in 2026, take a look at a curious state-by-state index tracking business performance.<\/p>\n
My trusty spreadsheet looked at monthly indices published by the Federal Reserve Bank of Philadelphia that gauge the relative strength of the 50 state economies, using a mix of job, income, inflation and gross domestic product statistics.<\/p>\n
This math shows California\u2019s economy has the third-strongest growth rate among states so far in 2026, expanding at an average annual rate of 3.3% through August.<\/p>\n
The only two states growing faster than the Golden State were Nevada, up 3.9%, and Ohio, up 3.4%.\u00a0In comparison, the median growth rate across all 50 states is 1.8%.<\/p>\n
How have California\u2019s major economic rivals fared in 2026? Texas ranked No. 12 for growth at 2.5%, with Florida at No. 26 at 1.8%.<\/p>\n
By the way, four states saw economic declines: West Virginia, down 2.1% in a year, Montana, down 0.8%, Connecticut, down 0.7% and Delaware, down 0.3%.<\/p>\n
Better than last year<\/p>\n
This year so far has been an improvement for California over 2025\u2019s performance, by this math.<\/p>\n
And 2025 wasn\u2019t so bad either. The Golden State economy ranked seventh best last year, with an average growth rate of 2.8%. In comparison, the 50-state median was 1.7%.<\/p>\n
Last year\u2019s fastest growth states were Nevada, up 3.7%, Idaho, up 3.2% and Texas, up 3%. Florida was No. 9 at 2.5%.<\/p>\n
And the bottom of the 2025 scorecard? West Virginia, off 0.2%, and Delaware and Michigan, off 0.4%.<\/p>\n
Not alone<\/p>\n
California was one of 27 states with 2026 year-to-date performance growth topping 2025.<\/p>\n
The Golden State\u2019s 0.6 percentage-point gain in growth rate was 12th best.<\/p>\n
The biggest gainers were Ohio, up 2 percentage points, Missouri, up 1.5 points and Iowa, up 1.4 points.<\/p>\n
The largest declines were in West Virginia, off 2.3 percentage points, Oklahoma, off 1.7 points and Illinois, off 1.6 points.<\/p>\n
California\u2019s rivals saw shrinking growth. Texas ranked No. 37, off 0.5 percentage points, with Florida at No. 41, off 0.7 points.<\/p>\n
Historically speaking<\/p>\n
The Philadelphia Fed indices date back to 1980, and the long-haul math shows California has the 11th-fastest-growing economy over 46 years, with a 3.2% annual rate of expansion.<\/p>\n
So if you\u2019re disappointed about 2026, well, the 3.3% year-to-date gain is just a shade above California\u2019s average. This is not a boom year.<\/p>\n
The fastest-growing states since 1980 are a who\u2019s who of places with which California is often compared: Nevada, up 4.5% annually, Arizona, up 4%, Utah, up 3.9% and Florida, up 3.6%. Texas ranked No. 6 at 3.5%.<\/p>\n
Ponder what\u2019s typical growth.\u00a0The 50-state median over 46 years was 2.4%, with the worst performer being Louisiana at 1.2% annual growth, followed by Alaska at 1.5% and Michigan at 1.6%.<\/p>\n