Individual states contribute mightily to U.S. economic growth, though some do so more than others, WalletHub, a personal finance website, notes in a report released Monday.

Take California, which jumped ahead of Japan as the world’s fourth-largest economy in 2024, with a GDP of some $4.1 trillion. Last year, the Golden State’s economy grew faster than that of the three countries ranked ahead of it: the U.S., China and Germany.

Vermont’s GDP, on the other hand, is around $45.7 billion, roughly 91 times smaller than California’s economic output.

“A strong state economy doesn’t guarantee success for the state’s residents, but it certainly makes financial success more attainable,” WalletHub analyst Chip Lupo said in a statement. “Factors like a low unemployment rate and high average income help residents purchase property, pay down debt and save for the future.”

Lupo pointed out that the best state economies are friendly to new businesses and invest in new technology that help them deal with future challenges and become more efficient.

In order to determine the best (and worst) state economies, WalletHub compared the 50 states and the District of Columbia across these key dimensions:

  • Economic activity, including change in GDP (2024 vs. 2023), share of fast-growing firms and state gross public debt as percent of GDP
  • Economic health, including unemployment rate, cost-of-living-adjusted median household income, foreclosure rate, building permit activity and growth in number of businesses
  • Innovation potential, including share of jobs in high-tech industries, industry R&D investment amount per total civilian employed population, independent inventor patents per 1,000 working-age population and non-industry R&D investment amount as share of GDP

Researchers evaluated those dimensions using 28 relevant metrics, and graded each one on a 100-point scale, with a score of 100 representing the highest economic performance.

See the gallery for the 15 states with the best economies, according to WalletHub.

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