Published 11 minutes ago on August 10, 2026 By Jenna Ross Graphics & Design Zack Aboulazm The following content is sponsored by Terzo Productivity by State: Where Work Is Becoming More ProductiveProductivity is one of the biggest drivers of long-term economic growth and rising living standards. But where in America is work becoming more productive?This graphic, created in partnership with Terzo, maps labor productivity growth across U.S. states. It’s part of our Markets in a Minute series, which delivers quick economic insights.Ranking Labor Productivity ChangesD.C. and Arizona led in productivity growth, which measures the change in the amount of goods and services produced per hour worked. Both areas saw output increase while hours worked decreased. In other words, workers were producing more in less time. State or DistrictLabor Productivity Change, 2024-2025District of Columbia5.2%Arizona4.4%California4.2%Massachusetts3.7%Oregon3.7%New Hampshire3.6%Minnesota3.5%Vermont3.4%Colorado3.2%Louisiana3.1%Connecticut3.0%Delaware3.0%Montana3.0%South Carolina3.0%Kentucky2.8%South Dakota2.7%Tennessee2.7%New York2.5%Iowa2.4%Hawaii2.3%Arkansas1.8%Ohio1.8%Virginia1.8%North Carolina1.7%Utah1.6%Alabama1.5%Wisconsin1.5%Maryland1.3%Florida1.1%Indiana1.1%New Mexico1.1%Rhode Island1.1%Illinois0.9%Maine0.9%Missouri0.9%Washington0.8%Michigan0.6%Texas0.6%Georgia0.4%New Jersey0.4%North Dakota0.4%Kansas0.1%Pennsylvania0.1%Nebraska-0.3%Nevada-0.3%Oklahoma-0.4%West Virginia-0.4%Wyoming-0.7%Mississippi-1.3%Alaska-2.3%Idaho-2.5% U.S.1.8% Source: U.S. Bureau of Labor Statistics. Data is for the private nonfarm sector, which excludes government, farms, and non-profit organizations.California came in third place at 4.2%. Because of the state’s economic size, California contributed nearly one-third of the labor productivity growth the U.S. saw nationally in 2025.States With the Biggest DropsWhile all states saw an increase in output, the hours worked climbed faster in some areas.Eight states became less productive, with Alaska and Idaho seeing the biggest drops. In particular, Alaska saw the highest output growth of 3.8%, but also the largest gain in hours worked of 6.2%. Why Productivity MattersThe differences across states highlight an important principle: economies and businesses become more productive when they can create more value without a proportional increase in labor. Businesses with strong productivity growth are often better positioned to expand margins, invest in innovation, and remain competitive.While technology plays a major role, productivity gains also come from removing inefficiencies that slow teams down. 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