Even America’s Poorest States Top Most G7 on GDP Per Person

Even America’s poorest states now exceed most G7 economies on GDP per person, according to fresh comparisons that challenge the familiar narrative of U.S. decline. The figures highlight how America’s economic outperformance since the pandemic has widened gaps with peers across the Atlantic and the Pacific.

What The Data Shows

Financial Times analysis notes that Mississippi—the lowest-ranked U.S. state by output per head—now has nominal GDP per person higher than the United Kingdom, France, Italy and Japan, and only slightly below Germany. That means the poorest U.S. states outperform “most” of the G7 on this metric; Canada and Germany are the notable exceptions. Mississippi now tops the UK on GDP per person, while states like West Virginia and Arkansas also clear several G7 peers.

Why The Gap Grew

Multiple structural forces sit behind the divergence. An International Monetary Fund study summarized by Reuters found Europe’s output per person (in purchasing-power terms) has slipped to roughly 72% of the U.S. level, with slower productivity growth doing most of the damage. Fragmented markets, thinner risk capital and lower labor mobility have weighed on European dynamism compared with the U.S., where large, integrated markets and deep capital pools have amplified investment in technology, energy and advanced manufacturing. EU output per head is about 72% of the U.S.

Mind The Metrics

Comparisons hinge on definitions. The headline claim reflects nominal GDP per person, which is sensitive to exchange rates; a strong dollar lifts U.S. readings relative to Europe and Japan. Adjusting for price levels narrows (but doesn’t erase) the gap. Within the U.S., cost-of-living differences are stark: the Bureau of Economic Analysis reports Mississippi’s regional price parity at 87.3 (U.S.=100), underscoring how far a dollar stretches there. And GDP per person isn’t a synonym for well-being; health outcomes, inequality and public services vary widely across and within countries.

The Bigger Picture

For policymakers abroad, the takeaway is less about American exceptionalism than about policy choices: boosting productivity, deepening capital markets and improving labor mobility. For U.S. leaders, it is a reminder that strong top-line output coexists with uneven access to opportunity. Cost-of-living gaps matter when comparing prosperity, and sustained gains depend on translating growth into broad-based living standards.

Sources

• The ‘grossly overvalued’ American dollar — Financial Times (January 16, 2025)
• Cross-border challenges widen wealth gap between Europe and US, IMF study finds — Reuters (November 14, 2024)
• Gross Domestic Product by State and Personal Income by State, 4th Quarter 2024 and Preliminary 2024 — U.S. Bureau of Economic Analysis (March 28, 2025)
• Regional Price Parities by State and Metro Area — U.S. Bureau of Economic Analysis (December 12, 2024)