Strong job growth, business activity and population gains pushed Texas ahead of every other state in the economy category, and 10th Overall Best State
AUSTIN, Texas – Texas has the strongest state economy in the country, according to the 2026 U.S. News & World Report Best States rankings released Tuesday. The Lone Star State moved up from second place last year to claim the top economic position among all 50 states.
U.S. News & World Report credited Texas with leading the nation in job growth. The state also earned strong scores for growth in gross domestic product, net migration and its younger population. The economy ranking examines areas such as economic growth, employment and the business environment.
Texas has a large and diverse economy built around energy, technology, manufacturing, farming, trade, health care and financial services. The state government estimates that Texas produced about $2.9 trillion in economic activity and is home to 57 Fortune 500 company headquarters, more than any other state other than New York. Other sources put Texas’ economy at just over $3 trillion, either way, this makes Texas’ GDP twice as large as Russia as a whole.
Texas finished ahead of Utah, Idaho, Arizona, South Dakota, South Carolina, Florida, Massachusetts, Colorado and North Dakota in the economy category. The ranking shows that several Southern, Mountain West and Midwestern states are gaining economic strength as workers and companies move toward faster-growing areas.
However, having the top economy did not make Texas the best state overall. U.S. News & World Report compares states across eight broad areas: health care, education, economy, infrastructure, opportunity, fiscal stability, crime and corrections, and the natural environment. The report uses 71 measures and thousands of data points.
Utah ranked first overall for the fourth year in a row. Utah placed among the top 10 states in five categories, including economy, fiscal stability, infrastructure, education, and crime and corrections. Its broad performance allowed it to remain first despite ranking near the bottom for its natural environment.
South Dakota ranked second overall, followed by Minnesota, North Dakota and Nebraska. New Hampshire placed sixth, Idaho seventh, Florida eighth, Washington ninth and Vermont tenth. Vermont also received the nation’s highest score for opportunity, while New Hampshire ranked first for crime and corrections.
The results show why a strong economy alone does not decide the overall ranking. A state may create many jobs and attract businesses but receive lower scores in health care, education, public safety, infrastructure or other areas that affect daily life.
Texas’ first-place economic ranking is still a major gain. It reflects the state’s ability to attract companies, workers and new residents while creating jobs and expanding its business base. At the same time, the overall rankings show that Texas must perform well across many other areas before it can join the nation’s 10 highest-ranked states.
The ranking is one measurement and does not mean every person will have the same experience. Economic growth can create opportunity, but fast population gains may also place pressure on housing, roads, schools, water supplies and the electric grid. Texas’ challenge will be turning its economic strength into improvements that residents can see in their communities.
