Connecticut’s economy expanded in the second quarter of 2025, with real GDP growing 4.6% — outpacing the national rate of 3.8%, according to new data from the U.S. Bureau of Economic Analysis released Friday.
Meantime, the state’s personal income surged 6.3%, in the second quarter, well above the national rate of 5.5%, ranking the state in the top quintile for income gains.
The Nutmeg State’s economic growth marks a dramatic increase from the first quarter.
Connecticut’s economy increased at a 0.3% annualized pace in the first quarter, compared to a 0.6% decrease nationally, BEA data shows. That followed economic growth of just 2.6% for all of 2024.
GDP is the market value of goods and services produced by the labor and property located in a state, and is considered the most comprehensive measure of economic activity.
The state’s dual gains placed it among the leaders in New England and the broader Northeast. Massachusetts came in slightly below Connecticut with real GDP growing 4.5% in the second quarter, while New York grew 4% and Rhode Island lagged at just 0.5%.
The state’s 4.6% GDP rate placed it ninth nationally, tied with Kentucky which had the same 4.6% rate.
Among New England states, Connecticut ranked third in personal income growth, trailing Massachusetts (7%) and Maine (6.9%) but significantly outpacing Vermont (4.8%), Rhode Island (4%) and New Hampshire (3.3%).
Personal income increased in all 50 states and the District of Columbia over the period.
The income gains were driven by multiple factors, including transfer receipts that increased 14.4% nationally due in part to retroactive payments to Social Security beneficiaries under the Social Security Fairness Act of 2024.
Earnings increased 4.4% nationally, with state-level changes in earnings ranging from a 12.2% increase in Kansas to a 3.3% decrease in Arkansas.
Nationally, sectors that drove the economic growth included finance and insurance, information services and nondurable-goods manufacturing, mirroring trends seen in many high-growth states, according to the BEA.
The BEA will release third-quarter 2025 state GDP and personal income data on Dec. 22.
Correction: The article has been updated to reflect that Connecticut tied with Kentucky for the ninth highest GDP rate at 4.6%.
