SC economy is no slouch. New federal report puts it above all but 2 other states. Here’s why
Is South Carolina’s economy thriving?
Many South Carolinians don’t think so, at least not currently. In a recent Winthrop poll, which had over 1,400 respondents, the majority of people rated the economy as bad, with half saying that they are not as well off financially as they were a year ago.
Increases in grocery prices, health care and housing costs were the main issues residents cited in the poll.
“Consumer sentiment remains very low, and the primary reason for that is because of rising prices and high inflation,” said Joseph Von Nessen, a research economist at UofSC.
Even though costs are up for the average consumer, SC’s economy is currently experiencing stable growth, according to Von Nessen, a trend that has continued over the last several years.
And in a recently released study from the U.S. Bureau of Labor Statistics, the state’s economic activity in 2025 was shown to be even more impressive. SC was revealed to have one of the nation’s highest growth rates in economic output, outpacing nearly every other state in the country.
Here’s everything you should know about the report:
What is economic output?
You might think that Gross Domestic Product (GDP) and economic output are the same, but they are two different measures of economic activity.
GDP is the total economic value that’s added at the national level from finished goods and services, while economic output measures the value of all sales of goods and services and is the sum of final purchases and intermediate inputs, resulting in the double counting of intermediate purchases.
Here’s how much SC’s economic output grew last year:
SC’s 2025 output rank
Output increased in all 50 states and the District of Columbia in 2025, but SC’s growth rate was only outmatched by two other states, Alaska (3.8%) and Florida (3.7%).
SC had the 3rd highest growth in output, increasing by 3.6% year-over-year.
What factors caused this growth?
Von Nessen said that the main reason SC’s economic output grew so fast last year was due to the state’s boom in population. Multiple cities in SC, such as Greer and Columbia, had thousands of additional residents settle down in 2025.
“Population growth has been both evidence of South Carolina’s success and one of the forces driving it,” he said. “South Carolina was the number one state in terms of population growth in 2025, and that generates very positive upward gains for the state.”
When more people move into a state, businesses see an opportunity to grow and expand, generating broad-based demand across most industry sectors, which in turn increases output growth.
For example, the state’s export sales grew by 1.5% in 2025, reaching $38.5 billion, which is the highest recorded value in seven years, according to a report from the SC Department of Commerce and SC Ports.
“South Carolina once again led the country in the export of passenger vehicles and tires, reflecting the strength of our manufacturing industry. Reaching the highest export value in seven years is the result of a skilled workforce and the confidence global markets place in products made in our state,” Gov. Henry McMaster said in a press release.
SC’s productivity and other stats
SC’s output growth was impressive, but there were other notable data points in the report.
According to the U.S. Bureau of Labor Statistics, SC’s nonfarm sector employed 2,171,103 people in 2025, and labor productivity increased by 3.0% year-over-year. Labor productivity is a measure that “compares economic output against the amount of labor required to produce that output,” according to Investopedia.
Here are the other annual changes that happened in 2025, the report found:
- Hours worked in SC increased by 0.6%
- Unit labor costs increased by 1.8%
- Labor compensation increased by 5.5%
- Hourly compensation increased by 4.8%
This story was originally published May 30, 2026 at 6:00 AM with the headline "SC economy is no slouch. New federal report puts it above all but 2 other states. Here’s why."