ICYMI: California’s best-in-class workforce drove nation-leading productivity growth in 2025

What you need to know: California continues to lead the nation in economic output, with new data showing California workers increased productivity by 4.2% in 2025, delivering the largest contribution of any state to national productivity growth.

SACRAMENTO - California continues to drive the nation's economy, with new data from the U.S. Bureau of Labor Statistics (BLS) showing California workers increased productivity by 4.2% in 2025. Representing about 14% of national output, California had the largest influence on national productivity.

California's workers, entrepreneurs, and innovators continue to prove that investing in California delivers real results. As one of the largest economies in the world, the Golden State demonstrates that a strong workforce, economic growth, innovation, and performance go hand in hand.

Governor Gavin Newsom

In 2025, workers in California's private-sector, nonfarm businesses increased productivity by 4.2%, accounting for nearly one-third of the nation's 1.8% productivity increase. In the evaluation of all 50 states and the District of Columbia, California was one of only two states to post productivity gains exceeding 4%.

California's productivity gains coincided with strong job growth, with the state adding 131,534 jobs over the past year-more than any other state during the same period. The Golden State is also home to four of the nation's fastest-growing job markets through the first quarter of 2026.

California's economy is dominating

The Golden State continues to lead the nation economically, outpacing all states and every developed nation, according to a recent Bloomberg analysis. In 2025, California continued a 16-year growth streak, growing faster than the second-largest state, Texas.

California also has more businesses than any other state, including Florida and Texas, supporting strong job creation and expanded economic opportunity for workers across the state. California is home to more than 4.3 million small businesses, representing 99.8% of all businesses in the state and employing 7.6 million people.

And California continues to lead the nation as the #1 state across key areas of economic strength and innovation, including:

• New business starts
• Manufacturing
• Venture capital funding
• High-tech business
• Agriculture