How does the US compare in economic might to other G7 nations?

Suck it Europe! Sorry almost forgot...suck it Japan and Canada.

Visualizing the G7 Economies by GDP Size

December 12, 2024

By Pallavi Rao, Visual Capitalist

Behold: the G7. A group born in the midst of the 1970s energy crisis in order to coordinate economic policy at a global level, by virtue of being some of the largest (non-communist) economies at the time.

In the decades since, other growing economies have emerged, taking over entire sectors (manufacturing) and reshaping geopolitics.

And within the G7 itself, the balance of power has shifted a little.

This chart breaks down the G7 economy, highlighting each member state’s share of PPP-adjusted GDP. Data is sourced from the International Monetary Fund (2024) and presented in International dollars.

The G7 is Looking More and More American

The G7 used to be a more equal group back in the 1980s. The U.S., of course, always had the population—and thus the economic—advantage, but shares of both were relatively balanced.

Looking closely, America was already doing a little better than others: 42% of the G7’s economy with only 37% of the population in 1980.

On the other hand there’s Japan, then at 19% of the G7’s population but 15% of its economy. For perspective, this data is a full 10 years before Japan’s “Lost Decades” when a real estate bubble collapse triggered multiple years of economic stagnation.

Now in 2024, the comparisons look very different, and there’s only one clear winner. The U.S.’s share of the G7’s PPP-adjusted output is 10 percentage points higher, with only about 43% of the population.

This means America is now outweighing all the other G7 members put together. At market-exchange terms (converting all prices to USD), America’s share is closer to 60% of the G7.

At the same time every single other G7 country except Canada has lost ground or stayed the same. The worst is Italy which contributed 10% to the G7 in 1980, and now contributes about 6%.

Why Does GDP Matter Anyway?

Of course GDP isn’t everything. It doesn’t measure income, savings, or happiness. That the U.S. is leaving Europe behind on this metric does not make up for other inequalities.

For example, American life expectancies used to be higher than Europe in 1980, now they’re almost a full year lower. Europeans enjoy more time off and a better work-life balance in general.

But burgeoning economic strength does have other advantages. Other countries look for favorable trade deals, and might acquiesce to demands in exchange for access to the American market.

At the same time, capital flows to pursue growth, enabling new businesses to thrive, creating an environment for innovation, and driving further growth.