States With the Fastest Real GDP Growth in 2025

Real gross domestic product (GDP) growth varied widely across the United States in 2025, but every state economy expanded. According to the U.S. Bureau of Economic Analysis (BEA), Florida and South Carolina tied for the fastest growth at 3.1 percent, while North Dakota recorded the slowest state growth at 0.3 percent. The national economy grew 2.1 percent in real terms, and the state-level data reveal a clear Sun Belt advantage over the Plains and Great Lakes regions.

Key Numbers

• U.S. real GDP growth, 2025: 2.1%
• Fastest-growing states: Florida and South Carolina, each 3.1%
• Slowest-growing state: North Dakota, 0.3%
• Mean state growth rate: 1.8%
• Median state growth rate: 1.8% (New Jersey)
• States growing faster than the mean: 26
• Indiana growth rate: 2.5%
• Kentucky growth rate: 1.0%

Explanation

State real GDP measures the value of all goods and services produced within a state’s borders, adjusted for inflation. The BEA releases annual and quarterly estimates for all 50 states and the District of Columbia. In 2025, the annualized year-over-year growth rates ranged from 0.3 percent in North Dakota to 3.1 percent in Florida and South Carolina. The mean and median growth rates were both 1.8 percent, indicating a relatively balanced distribution around the national average of 2.1 percent.

The geographic pattern is striking. Sun Belt states, particularly in the Southeast, generally outperformed the national average, while Plains and Great Lakes states lagged. This reflects broader demographic and industry trends, including population migration to warmer climates and growth in finance, information, and professional services. However, the BEA does not attribute state growth to any single cause in its release.

It is important to distinguish between annual growth and quarterly annualized rates. In the third quarter of 2025, for example, real GDP increased at an annual rate of 4.4 percent nationally, with Kansas growing at 6.5 percent and North Dakota at 0.4 percent. The annual 2025 figures smooth out quarterly volatility and provide a clearer picture of longer-term state performance.

State Comparison

Florida and South Carolina led all states in 2025, each expanding by 3.1 percent. Indiana followed with 2.5 percent growth, while Arkansas and Tennessee also grew faster than the national average, according to the St. Louis Fed’s Eighth District summary. At the other end, North Dakota grew just 0.3 percent, and the District of Columbia—often included in BEA state tables—grew 0.4 percent.

The table above includes selected states and areas for which 2025 annual growth rates were reported in the sources. BEA data cover all 50 states and the District of Columbia, but not all individual state figures were highlighted in the retrieved releases. The full BEA release provides complete state-by-state data.

National Comparison

The U.S. economy grew 2.1 percent in real terms in 2025. The mean state growth rate was 1.8 percent, and the median state—New Jersey—also grew 1.8 percent. A total of 26 states grew faster than the mean, while 24 states and the District of Columbia grew more slowly. California and Texas, the country’s largest state economies, both grew faster than the national growth rate, according to Statista’s summary of BEA data.

This means that the national figure masks considerable variation. While the national economy expanded at a moderate pace, the fastest-growing states grew nearly ten times faster than the slowest. The gap between Florida and South Carolina at 3.1 percent and North Dakota at 0.3 percent is 2.8 percentage points—a wide spread for a single year. Because large states such as California and Texas grew faster than the national average, the national weighted growth rate of 2.1 percent exceeded the simple mean state growth rate of 1.8 percent.

Ranking Table

The following table ranks selected states and areas by their 2025 real GDP growth rates, based on the available BEA data. Because the sources did not list every state’s exact figure, this is not a complete 50-state ranking, but it shows the leaders and laggards clearly.

Arkansas and Tennessee also grew faster than the national average, but their exact 2025 rates were not specified in the retrieved sources. The full BEA release provides complete state-by-state data.

Year-over-Year Change

The 2025 state GDP growth rates are annualized year-over-year changes, meaning they compare the level of real GDP in 2025 with the level in 2024. This measure removes the effects of inflation and shows how much the volume of economic output changed over the year. All 50 states and the District of Columbia recorded positive year-over-year growth in 2025.

The range of year-over-year changes—from 0.3 percent to 3.1 percent—indicates that no state economy contracted, but the pace of expansion varied significantly. The mean and median both at 1.8 percent suggest that the distribution was not heavily skewed by outliers, though the top states clearly pulled the average upward relative to the slowest states. Quarterly annualized rates can be much higher or lower; for example, the national annualized rate was 4.4 percent in the third quarter of 2025, but the annual figure was 2.1 percent.

Factors Behind the Trend

The geographic pattern in 2025 state GDP growth is consistent with several long-running trends. Sun Belt states have generally attracted population and business investment, supporting faster growth in construction, professional services, and consumer-facing industries. In the third quarter of 2025, the BEA identified information; finance and insurance; and professional, scientific, and technical services as leading contributors to national growth—sectors that are often concentrated in faster-growing metropolitan areas.

By contrast, Plains and Great Lakes states have faced slower population growth and a heavier reliance on agriculture, energy, and manufacturing, which can be more volatile or slower to expand. North Dakota’s 0.3 percent growth, for example, reflects a much slower pace than the national average, though the BEA does not attribute the slowdown to any single industry in its annual state release.

The St. Louis Fed noted that three of its Eighth District states—Arkansas, Indiana, and Tennessee—grew faster than the national average, while Illinois, Kentucky, Mississippi, and Missouri grew more slowly.

Why It Matters

State GDP growth is a key indicator of regional economic health. Faster growth typically supports job creation, higher incomes, and stronger state and local tax revenues, while slower growth can signal structural challenges or weaker demand. Businesses, policymakers, and investors use state GDP data to compare regional performance, allocate resources, and make location decisions.

The 2025 data also highlight the uneven nature of the U.S. economic expansion. Even as the national economy grew at a solid 2.1 percent, some states expanded nearly three times faster than others. Understanding these differences helps explain migration patterns, housing demand, and regional policy debates. For example, faster-growing Sun Belt states may face greater pressure on infrastructure and housing, while slower-growing Plains states may focus on workforce retention and industry diversification.

How GDP Is Calculated

Gross domestic product measures the market value of all final goods and services produced within a geographic area over a specific period. For state GDP, the BEA estimates production by industry and adjusts for inflation to produce real GDP, which allows meaningful comparisons over time. The annual growth rate is calculated as the percentage change in real GDP from one year to the next.

State GDP estimates are derived from national GDP by allocating production to states based on data such as wages, employment, and industry output. The BEA releases both quarterly and annual state GDP statistics, with quarterly figures expressed at annualized rates to show what the growth would be if the quarterly pace continued for a full year.

Nominal vs Real GDP

Nominal GDP measures output using current prices, while real GDP adjusts for inflation by holding prices constant across time. Because inflation can make nominal GDP rise even when the actual quantity of goods and services produced does not, real GDP is the preferred measure for comparing economic growth across years. The 2025 state growth rates discussed here are all real, inflation-adjusted figures.

For example, if a state’s nominal GDP rose 5 percent but prices rose 2 percent, its real GDP growth would be approximately 3 percent. The BEA uses chain-type price indexes to remove the effects of inflation and produce accurate real growth rates for each state.

Limitations of the Data

State GDP estimates are subject to revision as more complete data become available. The BEA notes that its state-level figures are less detailed and less timely than national GDP statistics, and early estimates can change. The 2025 annual figures released in April 2026 may be revised in future updates.

Additionally, the annualized year-over-year growth rates smooth out quarterly fluctuations but can still be influenced by one-time events, industry-specific shocks, or changes in population. The District of Columbia is included in BEA state tables but is not a state, and its small economy can show different dynamics. Small differences between states—such as 1.8 percent versus 2.0 percent—may not be statistically significant and should be interpreted with caution.

Source & Data Date

Primary source: U.S. Bureau of Economic Analysis (BEA), Gross Domestic Product by State, annual 2025 data released April 9, 2026, and summarized by the St. Louis Fed’s FRED Blog on April 13, 2026. Additional context from Visual Capitalist and Statista, both citing BEA data. Quarterly data from BEA’s third quarter 2025 release, published January 23, 2026.