West Coast vs. East Coast Economy: An Overview
If California was a nation, it would be the world's fifth largest economy, edging out Great Britain. The state's gross domestic product was more than $2.7 trillion in 2017, a growth of $127 billion from a year before. In 2018, it rose to an even $3 trillion.
In an East-West comparison, it depends on the choice of comparisons. The New York City region alone is much smaller at about $1.7 trillion a year. But count in just the two next-biggest economies on the East Coast and the figures for the East Coast are roughly equal to those for the West Coast.
The West Coast Economy
California is a triple threat economically. The technology sector is centered in San Francisco and the surrounding region, now known as Silicon Valley. The entertainment industry works out of Los Angeles. And the Central Valley harvests fruits and vegetables.
But don't forget the wine industry. California wine sales in the U.S. alone sailed above $35 billion in 2017.
On top of that, California has seen a surge in growth attributed to the financial services industry and upwards pressure on real estate prices. Both have seen strong growth since the financial crisis of 2008 ended.
The West Coast has at least one other big advantage: It's the gateway to international trade. California, Oregon, and Washington all have major ports for trade between the U.S. and Asia that support the exchange of goods, dominated by American agricultural products and Asian manufactured products. As Asian economies continue to develop and participate more in the global economy, these ports have become increasingly integral to the world economy.
Total California wine sales in the U.S. in 2017.
Any consideration of the West Coast economy should not leave out Oregon and Washington state. Both were among the top-performing states nationally in GDP growth between 2017 and 2018.
The Pacific Northwest has become a center of technological innovation as the headquarters of Microsoft and Amazon as well as other businesses such as the aerospace leader Boeing and retailers Costco and Starbucks.
The East Coast Economy
If we're going to compare apples to apples, let's take a look initially at California versus New York State.
New York State's GDP in 2018 was $1.7 trillion, far smaller than California's $2.7 trillion and roughly comparable to the economy of Australia.
However, given New York City's vast sprawl across several states, it might be more reasonable to consider the New York metropolitan area as compared to California. The New York metro region had a gross metropolitan product (GMP) of more than $1.5 trillion, according to the federal Office of Management and Budget.
Utah is the fastest growing state, at 4.3% growth, and Colorado and Florida are growing as fast as California, at 3.5%.
But in terms of East Coast economies, that omits the Philadelphia area, at about $445 billion, and the Boston area, at about $438 billion. Those three regions alone roughly equal California's economy, while leaving out a number of smaller but not insignificant cities.
New York City is, of course, the financial capital of the U.S., if not the world, and has significant stakes in media, publishing, and new technology. Although these may be the specialties most closely identified with New York City, the biggest New York industries, after finance, are now healthcare, financial and technical services, retail, manufacturing, and educational services.
Topping it off, many of America’s global corporate giants are headquartered in the New York City area, including Citibank, IBM, JPMorgan Chase, PepsiCo, Pfizer, and Verizon.
- California's gross domestic product was more than $2.7 trillion in 2017.
- The East Coast's total was roughly the same when the three biggest metro areas are combined.
- Increasingly, the biggest companies have a strong presence on both coasts.
Special Considerations on West and East
The West Coast versus East Coast question may not be relevant much longer.
Google and its parent company, Alphabet, are headquartered in San Francisco, but Google has 7,000 employees at its offices in New York City. California has Silicon Valley, but new media companies like Vice Media, Snaphat, and BuzzFeed operate out of New York, as do many traditional print media companies that have transitioned to the internet. New York dominates banking, but Wells Fargo is based in California.
For that matter, Bank of America is headquartered in Charlotte, North Carolina.
There are no bigger state economies in the U.S. than California and New York, but there are faster-growing economies. Among them, according to 2018 figures from the Bureau of Economic Analysis: Colorado and Florida matched California's 3.5% growth rate and Utah, at 4.3% growth, beat them all.