New York’s economy barely grew in 2023, trailing far behind stronger growth rates in the national economy and almost all other states, according to preliminary real gross domestic product (GDP) estimates by the federal Bureau of Economic Analysis.
Real GDP in the Empire State rose just 0.7 percent last year, less than one-third the U.S. growth rate of 2.5 percent, the BEA said. Among all states, only Delaware (-1.2 percent) and Wisconsin (0.2 percent) had smaller GDP increases.
Including the BEA’s preliminary 2023 figures, New York has trailed U.S. Real GDP growth in four of the last six years. Faster economic growth wasn’t just a Sunbelt phenomenon; including New York, the five-state (plus District of Columbia) Mideast region as a whole grew by 1.3 percent, and New England was moderately better than that at 1.5 percent—more than double New York’s growth rate.
As shown below, New York has trailed the U.S. in annual Real GDP growth rate in four of the last six years. It only barely exceeded the U.S. average in 2019 and 2022.
While growth accelerated near the end of 2023, New York’s annualized fourth-quarter Real GDP increase of 1.6 percent remained exceptionally sluggish — less than half the national average, as illustrated by BEA’s map below. Only Maryland, Kansas and Nebraska had slower Q4 growth.
The table below shows how much each industrial sector contributed to total percentage Real GDP change in the state and in the nation as a whole in 2023. New York’s 15 growth sectors were led by health & social assistance (much of it heavily government subsidized) and retail trade, which together added almost a full percentage point to growth. But pulling down all the positives were eight sectors with output declines—weighted down most of all by finance and insurance, which subtracted 1.05 from GDP, a far worse showing than in the nation as a whole.
The income difference
GDP is the broadest measure of the value of goods and services produced and consumed in the economy by individuals, businesses, and government. The Empire State fared comparatively better last year in the narrower data category of personal income—which includes net earnings of workers and proprietors, dividends and interest payments and “transfer payments,” which consists of money received by individuals for which no current services are performed (such as retirement benefits and welfare cash assistance).
New Yorkers’ personal income increased by 5 percent in 2023—good enough to rank 24th out of 50 states, not far below the national average of 5.2 percent. In the fourth quarter, however, the personal income growth in New York slowed to an annualized rate of 3.1, while the national growth rate was 4 percent. As reflected in the BEA map, New York’s Q4 performance ranked in the lower rung—43 out of 50.
Relative to population, New Yorkers’ personal income remained the nation’s sixth highest at $79,781 per capita, compared to a national per capita average of $68,531. Neighboring Massachusetts ($87,812), Connecticut ($87,447), and New Jersey ($80,724) ranked first through third highest, respectively, with California fourth ($80,423) and Washington fifth ($79,659).
Including preliminary data for 2023, personal income growth in New York State has trailed the national average for six consecutive years.
