“California reigns supreme with the GDP-equivalent of $40.2-B derived from agriculture, forest and hunting in Y 2020. That is greater than the output from the next 5 largest states: Iowa, Washington, Illinois, Texas and Nebraska combined” — Paul Ebeling
No one anticipated the latest data readout showing the Golden State has no peers among developed economies for expanding GDP, creating jobs, raising household income, manufacturing growth, investment in innovation, producing clean energy and unprecedented wealth through its stocks and bonds. All of which underlines Governor Gavin Newsom’s announcement last month of the biggest state tax rebate in American history.
By adding 1.3-M people to its NFPs since April last yr, California surpassed Texas and New York.
California household income increased $164-B, almost as much as Texas, Florida and Pennsylvania combined.
No wonder California’s operating budget surplus, fueled by its surging economy and capital gains taxes, swelled to a record $75-B.
If anything, the VirusCasedemic accelerated California’s record productivity.
Quarterly revenue per employee of the publicly-traded companies based in the state climbed to an all-time high of $1.5-M in May, 63% greater than its similar milestone 10yrs ago.
The rest of the US was nothing special, with productivity among those members of the Russell 3000 Index, which is made up of both large and small companies, little changed during the past 10yrs.
In a sign of investor demand, the weight of California companies in the benchmark S&P 500 Index increased 3% since a yr ago, the most among all states.
Faith in California credit was superlative, with the weight of corporate bonds sold by companies based in the state rising the most among all states, to 12.5% from 11.7% US Corporate Bond Index shows. Meaning: Investors had the greatest confidence in California companies during the virus chaos.
The most trusted measure of economic strength says California is the world-beater among democracies.
The state’s GDP increased 21% during the past five years, dwarfing #2 New York (14%) and # 3 Texas (12%). The gains added $530-B to the Golden State, 30% more than the increase for New York and Texas combined and equivalent to the entire economy of Sweden. Among the 5 largest economies, California outperforms the US, Japan and Germany with a growth rate exceeded only by China.
Enlarging its # 1 footprint with factory jobs
California GDP from manufacturing gained 13% over the past 5yrs to $316-B in Y 2020, an increase unmatched by any of the 10 largest manufacturing states: Texas was # 2 with 9% growth, followed by Indiana at 8%.
For all its bluster as being “best for business,” Texas can’t match California’s innovation. California prosperity is rooted in its appeal as a worldwide destination for technology and health-care development. Of the 6,924 corporate locations in the state, 18% are research and development facilities, a ratio that easily beats the US overall (11%), China (15%), UK (14%) and Japan (10%). Only Germany, at 19%, has a higher rate, according to data compiled by Bloomberg. The percentage of Texas facilities for R&D is less than 50% California’s at 8.2%.
Have a healthy day, Keep the Faith!
