GDP Grew 2.6% in 2024, Despite Fourth Quarter Slowdown

Connecticut’s economy expanded 2.6% in 2024, 23rd best among all states, despite a fourth quarter slowdown.

The U.S. Bureau of Economic Analysis’ March 28 report shows GDP rebounded from a first quarter contraction, growing 2.8% in the second quarter, 3% the following period, and 1.8% in the fourth quarter.

The retail trade, finance and insurance, and real estate sectors saw the largest productivity gains in 2024.

New England’s GDP increased 2.8% last year, led by New Hampshire’s economy, which grew 3.2%, 13th best in the country.

Rhode Island’s economy grew 3.2% (14th overall), followed by Maine (3%; 17th), Massachusetts (2.9%; 19th), Connecticut, and Vermont (2.3%; 32nd).

GDP increased in 48 states last year, with the national economy expanding 2.8%.

Labor Shortage

CBIA president and CEO Chris DiPentima said the fourth quarter economic numbers highlighted Connecticut’s post-pandemic challenges, particularly its acute shortage of labor.

“I see the GDP growth rate indicative of us not filling open jobs,” he said.

“Employers are offering high wages and benefits and a lot of flexibility, but they’re still not able to fill these openings.” 

At 0.8%, Connecticut’s 12-month job growth trails much of the region and the country, despite 92,000 job openings—31% above pre-pandemic levels. National job growth is 1.2%.

The BEA report included welcome population growth numbers—0.9%, second best in the region after Massachusetts (1%) and 18th best of all states.

“It’s positive to see population growth,” DiPentima said. “Hopefully, it’s working-age people who will help fill these job openings. If you fill the jobs, then you grow GDP.”

Sector Performance

Connecticut’s $296.6 billion real GDP accounts for 24% of New England’s $1.2 trillion economy, and is the second largest in the region behind Massachusetts ($638.4 billion). 

Eighteen of the 23 industry sectors that BEA tracks posted productivity gains in 2024, led by the retail trade sector, which expanded 0.52%. 

Finance and insurance grew 0.4%, followed by real estate (0.27%), healthcare (0.27%), professional services (0.19%), construction (0.14%), nondurable goods manufacturing (0.13%), management (0.13%), wholesale trade (0.12%), administrative services (0.07%), durable goods manufacturing (0.07%), information (0.06%), accommodation and food services (0.06%), arts, entertainment, and recreation (0.05%), military (0.05%), agriculture (0.04%), education (0.02%), and state and local government (0.02%).

The mining, utilities, and transportation sectors were unchanged for the year.

Other services output shrank 0.02% and federal government declined 0.01%.

At 4.5% growth, Utah had the country’s fastest economy in 2024, followed by South Carolina (4.2%), Idaho (3.9%), Indiana (3.8%), and Arkansas (3.7%).

North Dakota’s economy shrank 0.7%, with Iowa (-0.5%), South Dakota (-0.4%), Nebraska (0.6%), and Wyoming (0.8%) filling out the bottom five states.

Personal Income

Connecticut’s personal income, a key measure of economic competitiveness, grew 5.3% in 2024—23rd best in the nation—growing 9.5% in the first quarter, 3.2% in the second quarter, and 2.3% in the third. 

At $93,235, Connecticut’s per capita personal income is the second highest of any state after Massachusetts ($93,927).

New England personal income rose 5.5% to $87,655, while U.S. personal income grew 5.4% to $72,425.

At $93,235, Connecticut’s per capita personal income is the second highest of any state.

Massachusetts posted 5.7% growth (12th), followed by New Hampshire (5.5%; 19th), Maine (5.3%; 21st), Connecticut, and Vermont (4.9%; 33rd).

North Carolina (6.9%) saw the year’s largest increase, followed by South Carolina (6.7%), California (6.5%), Utah (6.1%), and Idaho (6.1%).

North Dakota experienced the worst personal income growth among the 50 states at 0.1%, followed by Nebraska (2.1%), Iowa (2.1%), South Dakota (2.7%), and Kansas (4%).