National Rankings Reveal Pennsylvania’s Subpar Economy 

A video companion of this press release for broadcast use is available here.

Harrisburg, Pa., January 28, 2026 — Recent comments about Pennsylvania have left pundits asking, “Is the commonwealth’s economy ‘mediocre’?” 

According to new analysis from the Commonwealth Foundation, the label fits. Pennsylvanians are fleeing the commonwealth for states with better tax climates and stronger business booms. 

Despite Gov. Josh Shapiro’s recent claims of Pennsylvania’s “growing economy,” the latest rankings reveal that Pennsylvania’s economic standing is subpar:  

• Pennsylvania has a 36th overall ranking in the Tax Foundation’s 2026 State Tax Competitiveness Index.  
• The American Legislative Exchange Council (ALEC) places Pennsylvania at 36th in economic outlook and 44th in economic performance. 
• Pennsylvania is 33rd for the number of small businesses per capita and 40th nationwide in start-up rates for small businesses. 
• Pennsylvania ranks 18th in job growth over the last three years, and 26th since 2020. 

New data from the U.S. Census Bureau reveal yet another net loss in state-to-state migration for Pennsylvania, leaving the commonwealth at risk for losing a congressional seat in the upcoming 2030 census.  

Latest polling from the Commonwealth Foundation found that those who considered moving out of Pennsylvania cited lower cost of living, lower taxes, and better jobs and opportunities as their primary motivations. 

Elizabeth Stelle, vice president of policy for the Commonwealth Foundation, issued the following statement in response: 

“Pennsylvanians continue to seek greener economic pastures in states like Texas and Florida, with lower taxes, lower costs of living, and a friendlier business climate. 

“Despite what the governor might claim, Pennsylvania’s economy is nothing more than subpar—and our families and industries are feeling the weight of it. 

“In 15 of the previous 16 years, Pennsylvania lost residents in state-to-state migration, with a net loss of 54,000 in 2020 alone. And that’s cost the state $16.5 billion worth of personal income from residents leaving, according to IRS data. 

“We’re on track to lose another congressional seat in 2030. Pennsylvania’s declining economic power puts our political influence at risk. 

“The Keystone State can be one of the best states to live and work, but only if lawmakers unleash our energy potential, remove regulatory and tax burdens on families and businesses, and offer transformative educational choice to our students. 

“Pennsylvanians deserve better than a state barely scrapping by as middle-of-the-road. In an energy-rich and geographically strategic state, ‘subpar’ economic growth is unacceptable.” 

Read the new analysis here. 

A video companion of this press release for broadcast use is available here.

For media inquiries, please contact Giana DePaul at gmd@commonwealthfoundation.org or (215) 859-0384.

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The Commonwealth Foundation transforms free-market ideas into public policies, empowering all Pennsylvanians to thrive.