Pennsylvania's economy sees moderate growth, housing market rebalances
Driving economic growth
Investments in data centers by Amazon and nuclear reactor agreements with Westinghouse are contributing to economic activity. The state's health and education sectors, along with white-collar industries, provide a stable economic foundation. Pennsylvania also ranked 11th in Site Selection Magazine's 2025 Business Climate Rankings.
Housing market right now
The median sales price for homes in Pennsylvania increased by 5.2% in March 2026 compared to March 2025. However, the number of homes sold decreased by 4.5% year-over-year, and inventory saw a 1.5% rise. Eastern Pennsylvania markets, including Lehigh County and Allentown, experienced continued price appreciation in 2025.
Migration patterns
Pennsylvania experienced a net decline of almost 3,000 people leaving for other U.S. states from 2024 to 2025. International migration, however, led to a net gain of 26,900 new residents in 2025, offsetting domestic out-migration. Top states for movers to Pennsylvania in 2024 included New Jersey, New York, and Florida.
Fiscal and regulatory challenges
Pennsylvania faces a projected structural deficit of $6.8 billion in the 2026-2027 fiscal year. Uncertainty regarding regulations and government policies is a primary concern for businesses in the Philadelphia region. Some counties, such as Philadelphia and Allegheny, have experienced numeric population declines from 2020 to 2025.
Key facts
- Pennsylvania's real gross state product is expected to grow at an average annual rate of 1.5% through 2029. (Commonwealth of Pennsylvania, 2025-2026 Estimate Documentation)
- The median sales price for homes in Pennsylvania was $295,000 in September 2024, a 9% increase from September 2023. (Pennsylvania Housing Market: Trends and Forecast 2025-2026, October 2024)
- Pennsylvania gained over 76,000 jobs from December 2024 to December 2025, a 1.2% increase year-over-year. (Commonwealth of Pennsylvania, March 2026)
- The 2025-2026 state budget increased spending to $50.09 billion, a 5.1% increase over the prior year. (Commonwealth Foundation, November 2025)
- PennDOT plans to invest over $655 million in infrastructure projects in Northeast PA during the 2026 construction season. (Global Highways, April 2026)