California, October 15, 2025
News Summary
California has officially overtaken Japan to become the world’s fourth-largest economy, with a nominal GDP of $4.1 trillion by the end of 2024. The state’s economic growth rate of 6% exceeds that of the U.S., China, and Germany, driven by investments in innovation and sustainability. Governor Gavin Newsom highlighted this achievement while addressing challenges like affordable housing and federal policy risks that impact the state’s economic interests.
California has officially surpassed Japan to become the world’s fourth-largest economy, with its nominal gross domestic product (GDP) reaching a staggering $4.1 trillion at the end of 2024. This new ranking positions California behind only the United States with a GDP of $29.18 trillion, China at $18.74 trillion, and Germany at $4.65 trillion.
The state’s impressive economic performance was highlighted by a growth rate of 6% in 2024, outpacing the growth rates of the U.S. at 5.3%, China at 2.6%, and Germany at 2.9%. This surge in California’s economy has been driven by significant investments in its populace, a focus on sustainability, and a commitment to innovation.
Governor Gavin Newsom announced the new rankings, noting California is not only keeping pace with the world but also setting the pace for economic growth and development. Factors contributing to California’s rise include both immigration and natural birth rates, which have led to a population increase despite the challenging affordable housing crisis the state is facing.
California is renowned as a leader in the technology sector, with approximately 20% of its workforce employed in this industry. Moreover, California is the largest agricultural producer in the United States, exporting around $24.3 billion worth of commodities in 2023. Notably, the state contributes $83 billion more in federal taxes annually than it receives in federal support.
However, the state’s administration has faced significant challenges, including economic risks posed by federal policies. Newsom’s administration filed a lawsuit against the Trump administration concerning tariff policies that threaten California’s economic interests. This lawsuit emphasizes the critical nature of California’s economic power to the nation, asserting the need for its protection.
California’s climb to fourth place comes after sitting at fifth since 2017, when it first achieved that rank. The state has since reclaimed its position in early 2025. The rise in ranking may also be influenced by external factors, such as fluctuations in currency exchange rates, particularly the depreciation of the Japanese yen against the U.S. dollar.
The International Monetary Fund (IMF) provided a cautious outlook for global economic growth, highlighting potential risks that may hinder progress, including extended uncertainty, protectionism, and corrections within financial markets. Despite a strong economic outlook for California, the state continues to grapple with high living costs and a significant homelessness crisis.
Overall, California’s ascent to the fourth-largest economy in the world underscores its robust economic activity, driven by a dynamic workforce, technological advancements, and agricultural sector strength, despite ongoing socio-economic challenges.
FAQ
- What is California’s nominal GDP as of the end of 2024? California’s nominal gross domestic product (GDP) reached $4.1 trillion at the end of 2024.
- How does California’s GDP compare to Japan’s? California’s GDP surpasses Japan’s nominal GDP of $4.02 trillion.
- Which countries have larger economies than California? California ranks behind the United States ($29.18 trillion), China ($18.74 trillion), and Germany ($4.65 trillion) in terms of economic size.
- What was California’s economic growth rate in 2024? The state experienced a growth rate of 6% in 2024.
- What are some key factors contributing to California’s economic performance? Significant investments in people, a focus on sustainability, and innovation are key factors.
- How does California’s workforce contribute to the technology sector? The technology sector employs approximately 20% of California’s workforce.
- What agricultural exports did California have in 2023? California exported approximately $24.3 billion worth of commodities in 2023.
- How much more does California contribute in federal taxes than it receives in federal support? California contributes $83 billion per year more in federal taxes than it receives in federal support.
- What ongoing challenges does California face? The state faces ongoing challenges including high living costs and a substantial homelessness crisis.
Deeper Dive: News & Info About This Topic
- Los Angeles Times: California’s Economy is Now the 4th Largest
- Wikipedia: Economy of California
- The Guardian: California Economy Surpasses Japan
- Google Search: California Economy
- Business Insider: California Becomes Fourth Largest Economy
- Encyclopedia Britannica: Economy
- Visual Capitalist: Mapped Economies
- USA Today: California GDP and Rankings
Author: STAFF HERE MISSION VIEJO WRITER
MISSION VIEJO STAFF WRITER The MISSION VIEJO STAFF WRITER represents the experienced team at HEREMissionViejo.com, your go-to source for actionable local news and information in Mission Viejo, Orange County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as Oso Fit 5K Fun Run and Community Health Fair, Walk Against Drugs & Community Fair, and National Night Out. Our coverage extends to key organizations like the Mission Viejo Chamber of Commerce and Providence Mission Hospital Mission Viejo, plus leading businesses in retail and education that power the local economy such as The Shops at Mission Viejo, Capistrano Unified School District, and Amazon Delivery Station. As part of the broader HERE network, including HEREAnaheim.com, HEREBeverlyHills.com, HERECostaMesa.com, HERECoronado.com, HEREHollywood.com, HEREHuntingtonBeach.com, HERELongBeach.com, HERELosAngeles.com, HERESanDiego.com, and HERESantaAna.com, we provide comprehensive, credible insights into California's dynamic landscape.
