California could be slipping in ranking

Will California lose its bragging rights this year as the world’s fifth-largest economy?

My trusty spreadsheet found that the Golden State could fall one notch in 2024 to fast-growing India in this theoretical ranking of economic heft, as measured by gross domestic product — a broad measure of business output.

Let’s start by noting that California businesses produced $3.86 trillion worth of goods and services in 2023 as tracked by the U.S. Bureau of Economic Analysis. Now, we’ll put that into a global perspective using figures from the International Monetary Fund.

In 2023, only four national economies were larger than California, by GDP math — the U.S. at $27 trillion (that’s with California included), China at $17.7 trillion, Germany at $4.4 trillion and Japan at $4.2 trillion.

But India wasn’t very far behind the Golden State in 2023 at $3.7 trillion. Then came the United Kingdom with a

$3.3 trillion GDP and France at $3.1 trillion.

Next, we’ll peek at the IMF’S forecasts for 2024. India’s economy is projected to produce $4.11 trillion of goods and services this year. The U.S. GDP is estimated to be $28 trillion.

So if California produces the 14.5% share of U.S. output it has averaged during the past two years, the Golden State would have $4.05 trillion in GDP in 2024.

That would translate to California falling just behind India — a nation with 1.4 billion residents, 36 times the Golden States’ population. Still, California would remain ahead of the United Kingdom, forecasted to be at $3.6 trillion, and France at a projected $3.2 trillion.

Not that California becoming “the world’s sixth-largest economy” is a shabby status, if it happens. But the potential demotion should serve as a reminder that California is constantly pushed to maintain its long-running standing as an economic leader — nationally and globally.

Slow year

Yes, 2023 was a tepid year for California’s business climate.

The statewide economy expanded by 2.1%, after inflation, as measured by GDP. That ranked No. 32 among the states and behind 2.5% U.S. growth. Yet it was a noteworthy improvement from 2022 when California’s meager 0.7% growth — No. 41 among the states — was topped by the nation’s 1.9% expansion.

For 2023, the nation’s best growth was found in North Dakota at 5.9%. Delaware’s 1.2% drop was the worst. And California’s two big economic rivals