Explore New Hampshire’s 2025 economic landscape: low unemployment, high incomes, and challenges in housing and labor supply.
By Granite State Report Staff
New Hampshire’s economy in 2025 is a paradox in motion: nationally enviable unemployment, high median incomes, and a tax structure that keeps the “Live Free or Die” ethos intact—paired with crushing housing costs, tight labor supply, and some of the priciest electricity in the country. For entrepreneurs, small-business owners, corporate site selectors, and policymakers, the picture is neither purely rosy nor bleak; it’s a set of tradeoffs that reward disciplined execution, regional savvy, and long-term investment.
This report synthesizes the latest federal and state data, independent research, and sector snapshots to map where New Hampshire’s economy stands today, where the pressure points lie, and what levers leaders can pull to keep the Granite State competitive.
1) Macro Snapshot: Growth, Jobs, Incomes
Output and growth. The Bureau of Economic Analysis (BEA) reports that U.S. real GDP grew 2.8% in 2024, with professional and business services, retail trade, and health care among the largest contributors nationally. New Hampshire’s economy rode those same currents, with estimates placing 2024 state real GDP near $96–97 billion and professional/business services as the single largest contributor to state output. (Bureau of Economic Analysis)
Jobs & unemployment. As of July 2025, New Hampshire’s seasonally adjusted unemployment rate was 3.1%, among the ten lowest in the nation and below the U.S. average. That strength reflects both resilient employer demand and the state’s chronically tight labor market. (Bureau of Labor Statistics)
Incomes & poverty. New Hampshire reliably posts some of the nation’s strongest household income figures, alongside one of the lowest measured poverty rates. The Census Bureau’s 2023 data show the Granite State had the lowest official state poverty rate (7.2%); 2024 ACS-based analyses indicate NH remained at or near the bottom nationally for poverty in 2024 as well. Median household income, measured by ACS 2023 one-year estimates, sits in the mid-$90Ks to around $100K depending on series, with state and independent researchers citing ~$96.8K–$99.8K. (Census)
What it means. New Hampshire is affluent and employed. But that prosperity coexists with affordability challenges (housing, child care, energy) that dampen the spending power of middle-income households and complicate recruitment for employers.
2) The Tax Structure: Competitive by Design
New Hampshire’s tax code remains a marquee advantage for businesses and high-earning workers: no broad-based sales tax, wage income tax, or capital gains tax. Those choices help keep the state consistently near the top of tax-competitiveness rankings. In the Tax Foundation’s 2025 State Business Tax Climate Index, New Hampshire ranks 6th overall and #1 on the sales-tax subindex (by virtue of having none). Recent improvements on corporate and individual tax components have helped the state climb steadily since 2020. (Tax Foundation)
That said, the system leans heavily on business taxes for state revenue. The Business Profits Tax (BPT) rate for periods ending on or after Dec. 31, 2023 is 7.5%, with single-sales-factor apportionment in effect; business tax receipts account for an outsized share of general and education funds. For some firms—especially margin-thin manufacturers—the BPT burden is a consideration, even as overall tax competitiveness remains a net positive. (revenue.nh.gov)
What it means. For mobile capital, NH’s headline tax profile is compelling. But the structure’s reliance on business taxes underscores why cyclical downturns can hit state revenues, and why broadening the base through growth is vital.
3) Small Business: The Economic Backbone
Small firms dominate the Granite State:
- 142,626 small businesses operate in NH, comprising 99.0% of all businesses and employing roughly 294,000 people (≈50% of the workforce). (Office of Advocacy)
- From the most recent SBA dynamics (through 2023 and into 2024/25), establishment openings have outpaced closures, with net gains in establishments and jobs. In the 2025 update, NH saw 7,032 establishments open and 6,374 close (net +658); small businesses accounted for the majority of those dynamics and netted +6,000+ jobs from openings/expansions minus closings/contractions. (Office of Advocacy)
Capital access remains a pressure point nationally; however, SBA-backed lending rose in FY2024, emphasizing smaller loans and broader lender participation. That tailwind helps NH’s small firms—especially women-, Black-, and Latino-owned businesses—bridge financing gaps. (AP News)
What it means. New Hampshire’s entrepreneurial base is expansive and resilient. Continued attention to capital pipelines, permitting speed, and workforce housing will determine whether “resilient” becomes “scalable.”
4) Industry Mix: Advanced Manufacturing, Tech/ProfSvcs, Health, Tourism
Advanced manufacturing. Manufacturing is smaller as a share of total employment than a generation ago, but still central to NH’s high-value economy. In 2024, manufacturing averaged ~68,800 jobs (~9.8% of nonfarm), with concentrations in aerospace/defense, precision electronics, medical devices, and firearms. By NH Employment Security’s count, manufacturing represented ~11–12% of private employment depending on the slice and period. Firms like BAE Systems, SIG SAUER, and parts suppliers anchor clusters in Nashua, Merrimack Valley, and the Seacoast. (nhes.nh.gov)
Professional & business services / Tech. BEA’s industry breakdown highlights professional & business services as a leading GDP contributor in 2024—consistent with NH’s role as a satellite for Boston’s innovation economy. Proximity to Route 128/Interstate-93 corridors and remote-enabled work arrangements continue to pull talent north—if housing and childcare are available. (Bureau of Economic Analysis)
Health care & education. Health care and social assistance are among the state’s top growth engines—driven by demographics (aging population), post-pandemic care backlogs, and regional hospital/medical network expansion. That sector also reflects NH’s workforce constraints, as nursing, behavioral health, and allied health shortages persist. (Bureau of Economic Analysis)
Tourism & outdoor economy. Tourism is one of NH’s largest private-sector employers and revenue drivers. State tourism officials counted ~70,000 jobs supported by visitor spending, and recent seasons set records: 4.5 million summer visitors in FY2023, $2.3B in spending; for summer 2025, officials forecast 4.8 million visitors and $2.6B in spending, up ~3% y/y. The White Mountains, Lakes Region, Seacoast, and brew/distillery/wine trails amplify this impact. (Visit NH)
International trade. Exports remain meaningful—$7.1B in 2024, diversified across electronics, machinery, and niche food/ag products (lobster and chocolate among notable categories); China accounted for ~5% of goods exports in 2024. Foreign-headquartered firms employ tens of thousands of Granite Staters, linking NH to global supply chains. (NH Economy)
What it means. New Hampshire’s portfolio tilts toward high-value manufacturing and services, plus a weather-sensitive tourism base. The growth runway is real—but bounded by workforce and infrastructure constraints.
5) The Labor Squeeze: Demographics, Child Care, Commuting
Aging and migration. New Hampshire’s population grew modestly through 2024, with net in-migration from Massachusetts and elsewhere offsetting aging-related headwinds. The state’s demographic profile keeps labor participation tight relative to demand. (Census.gov)
Child care affordability & availability. For families—and by extension, employers—child care remains a binding constraint on labor force participation. In 2023, the average annual price for an infant in center-based care was ~$17,250 (family-based ~$11,402); the combined cost for an infant + a four-year-old in center care approached $31,900. UNH’s Carsey School similarly pegs combined infant + preschool center-based care near $32,000—about 28% of median income among NH families with young children. State market-rate and affordability analyses from 2024 confirm both high prices and limited slots. (New Hampshire Fiscal Policy Institute)
Commuting and regional pulls. Historically, New Hampshire benefits from cross-border commuting and remote work into the Boston metro’s tech/finance/biotech ecosystem. That dynamic lifts incomes but pressures housing and transportation corridors (especially I-93, Everett Turnpike, Route 101).
What it means. If New Hampshire wants higher labor-force participation—especially among parents of young children—it needs more affordable child care capacity, faster licensing and expansion pathways, and targeted wage supports for providers.
6) The Housing Brake: Prices, Supply, and Growth
Housing is the single largest economic constraint in New Hampshire. The inventory shortage that began years before the pandemic has hardened into a structural cap on growth:
- Record median home prices. The statewide median hit $565,000 in June 2025, breaking the prior record set in June 2024 ($540,000), and staying above $500,000 every month since March 2024. Active listings remain far below historical norms. (New Hampshire Bulletin)
- Affordability crunch. With mortgage rates higher than pre-2022 norms and incomes growing more slowly than housing costs, the ownership ladder has pulled away from first-time buyers and middle-income families. The macro story—housing costs outpacing inflation nationwide—lands acutely in a high-demand, low-supply state like NH. (The Washington Post)
The downstream impacts: employers struggle to recruit non-local candidates; would-be entrepreneurs and service workers face long commutes or exit the state; household formation slows; and regional inequities widen.
What it means. Zoning reform, “missing middle” infill, streamlined approvals, and incentives for workforce housing near job centers are economic policy, not just social policy. Without supply-side acceleration, growth will keep throttling at the housing constraint.
7) Infrastructure and the Cost of Doing Business: Energy & Broadband
Electricity prices. New Hampshire’s average retail electricity rates sit well above the U.S. average. EIA data place NH’s average retail price near 23 cents/kWh (2023 all-sector), with mid-2025 tables showing residential and commercial prices still elevated relative to national peers. High energy costs ripple through manufacturing margins and small-business operating expenses. (U.S. Energy Information Administration)
Broadband. The state is in the midst of the most significant broadband build-out in its history. Between ARPA and the federal BEAD program, more than $318 million is slated to connect “tens of thousands” of unserved and underserved locations; New Hampshire’s BEAD allocation alone totals $196.5 million. Program rule changes announced by Commerce in mid-2025 have sparked pushback from NH’s congressional delegation, who warn revisions could slow rural builds. Execution and permitting speed will determine how quickly last-mile gaps close. (NH Economy)
What it means. For advanced manufacturing, data-intensive firms, and distributed workforces, energy and broadband are make-or-break inputs. Stabilizing electricity costs and finishing the fiber backbone are prerequisites for the next wave of growth (AI-enabled data services, robotics, precision machining, biotech).
8) Trade, Tourism, and the Regional Flywheel
Exports and FDI. New Hampshire punches above its weight in global markets. Electronics and machinery lead goods exports; niche food products like lobsters and confections add flavor. Foreign-owned companies directly employ ~50,600 NH workers, embedding the state in global value chains and technology transfer. (U.S. Chamber of Commerce)
Visitor economy. Tourism’s momentum, aided by outdoor recreation and craft-beverage trails, supports tens of thousands of jobs and billions in spending each year; recent campaigns and seasons have set records or near-records. That revenue stabilizes rural and mountain towns but also raises housing and infrastructure considerations in peak months. (Visit NH)
What it means. Trade and tourism diversify revenue and raise NH’s profile. Strategically, the state should keep layering export assistance (e.g., STEP grants, trade missions) with destination-management policies that balance growth with community capacity.
9) Risks and Headwinds
- National slowdown risk. The BLS’s preliminary 2024–early 2025 payroll revision showed the U.S. added ~911,000 fewer jobs than initially reported, a sign that growth may be softer under the hood. A national deceleration would filter into NH’s revenues and hiring. (The Wall Street Journal)
- Sticky costs. Housing and child care continue to outpace typical income gains; even as inflation cools, families feel squeezed—pressuring consumer-facing sectors and entry-level hiring. (The Washington Post)
- Energy price volatility. Elevated and volatile power prices disadvantage electricity-intensive manufacturing and data-center prospects, though regional generation mix and grid investments could mitigate over time. (U.S. Energy Information Administration)
- Program uncertainty. Policy changes to federal broadband programs risk delaying rural builds and undermining cost models for providers mid-project. (shaheen.senate.gov)
10) Strategic Opportunities and Action Plan
(A) Accelerate Workforce Housing
- Modernize zoning to allow duplexes, ADUs, and small-scale multifamily by right in job-rich corridors (I-93, Everett Turnpike, Seacoast).
- Incentivize “missing middle” with density bonuses and expedited approvals for projects setting aside units at workforce price points.
- Target public infrastructure (water/sewer, complete streets) to unlock infill sites near transit and town centers.
Why it matters: The fastest lever to expand the labor pool is to let more workers live closer to jobs. NH’s economic ceiling is, in practice, a housing ceiling. The data on record-high median prices and historically low inventory argue for urgency. (New Hampshire Bulletin)
(B) Child Care as Economic Infrastructure
- Expand capacity by streamlining licensing, enabling flexible space conversions, and offering one-time grants/loan guarantees for center build-outs in care deserts.
- Stabilize wages for early educators through targeted public-private wage supports tied to quality benchmarks.
- Employers: adopt on-site/near-site partnerships or pooled-slot purchasing to stabilize staffing.
Why it matters: With infant care near $17K and two-child center care near $32K, many parents scale back hours or exit the labor force. Every provider we stabilize is a workforce-participation boost. (New Hampshire Fiscal Policy Institute)
(C) Finish the Fiber
- Lock in BEAD timelines with clear state guidance; de-risk provider projects where federal rule changes created uncertainty.
- Leverage municipal and cooperative models where private ROI is thin but community benefits are high.
Why it matters: Modern manufacturing, telehealth, education, and tourism marketing all depend on reliable, affordable broadband. NH’s $196.5M BEAD allocation and >$318M in combined funding are generational opportunities—if execution stays on track. (NH Economy)
(D) Compete on Energy Reliability and Cost
- Enable long-term procurement for renewables and firm resources (including imports via ISO-NE) that improve price stability.
- Supercharge efficiency for small manufacturers (grants + audits) and electrify cost-effective process heat to hedge fuel volatility.
- Streamline interconnection and grid-upgrade planning for commercial rooftop/community solar where it lowers site-level bills.
Why it matters: NH’s elevated retail electricity prices are a known site-selection hurdle. Predictable, slightly lower long-run costs can tip deals in precision manufacturing and data-adjacent services. (U.S. Energy Information Administration)
(E) Keep the Tax Edge While Broadening the Base
- Codify gradual BPT rate glide paths tied to revenue triggers to minimize shock risk while signaling pro-growth intent.
- Double down on small-business formation with streamlined registration, unified permitting portals, and evergreen seed/loan funds to complement SBA pipelines.
Why it matters: The state’s #6 overall tax competitiveness is a brand asset. Pairing that with easier starts, faster permits, and patient capital makes NH sticky for founders. (Tax Foundation)
(F) Export More; Welcome More
- Expand trade assistance (STEP grants, export diagnostics, trade missions) for first-time exporters in electronics, medical devices, outdoor gear, and specialty foods.
- Proactive FDI outreach to European and Canadian firms seeking a Northeast foothold but wary of Boston-area costs.
Why it matters: With $7.1B in 2024 exports and 50,000+ jobs at foreign-owned firms, trade is a proven growth engine; scaling it compounds productivity and wage gains. (NH Economy)
11) Outlook: Cautious Optimism, Conditional on Execution
The Granite State heads into late-2025 with real strengths: a diversified, high-value economy; elite unemployment and income metrics; a business-friendly tax code; and world-class natural amenities that attract both tourists and transplants. The friction points—housing, child care, electricity costs, and last-mile broadband—are solvable with focus and follow-through.
If policymakers and private-sector leaders move decisively on those fundamentals, New Hampshire can turn today’s constraints into tomorrow’s comparative advantages. The goal is simple: make it easier to live, work, make, and build here. Do that, and the next cycle of growth will take care of itself.
Sources
- Bureau of Economic Analysis (BEA) – GDP by State, 2024 (release March 28, 2025). (Bureau of Economic Analysis)
- USAFacts (compiled from BEA) – New Hampshire GDP by industry, 2024. (USAFacts)
- Bureau of Labor Statistics (BLS) – State Employment & Unemployment, July 2025. (Bureau of Labor Statistics)
- BLS (State Unemployment Table) – July 2025 state unemployment ranking. (Bureau of Labor Statistics)
- Census Bureau (ACS Briefs) – Poverty in States (2023). (Census)
- Census / NHFPI – NH poverty and income analyses (2023–2024). (New Hampshire Fiscal Policy Institute)
- Census data portal – NH median household income profile (ACS). (Census Data)
- NH Employment Security (ELMI) – Manufacturing employment fact sheets; industry employment (2019–2024). (nhes.nh.gov)
- NH Department of Business & Economic Affairs (BEA) – Research & Strategy; tourism news/forecasts; exports. (NH Economy)
- Tax Foundation – 2025 State Business Tax Climate Index (overall & NH page). (Tax Foundation)
- NH Department of Revenue Administration – Business Profits Tax rates and apportionment. (revenue.nh.gov)
- SBA Office of Advocacy – 2024 and 2025 NH Small Business Profiles; national lending trends (AP report). (Office of Advocacy)
- NHFPI – Housing price trends (2024–2025); population/migration briefs. (New Hampshire Fiscal Policy Institute)
- New Hampshire Bulletin – Median home price record (June 2025). (New Hampshire Bulletin)
- NH Association of REALTORS® – Monthly indicators (price records). (New Hampshire REALTORS)
- Child care – NHFPI affordability (2024); Carsey School of Public Policy (2024); NH Market Rate Study (2024); Child Care Aware (2025). (New Hampshire Fiscal Policy Institute)
- Energy – EIA state electricity profile & monthly price tables. (U.S. Energy Information Administration)
- Broadband – NH Office of Broadband Initiatives (BEAD allocation, combined funding); NH delegation statement re: BEAD changes (Aug. 2025). (NH Economy)
- Trade – U.S. Chamber “Trade Means Growth” (NH), US-China Business Council (NH exports to China). (U.S. Chamber of Commerce)
- Tourism – VisitNH economic impact page. (Visit NH)
Editor’s note: This article emphasizes the latest available releases as of Sept. 15, 2025. Where multiple reputable sources report slightly different figures (e.g., ACS series vs. 5-year estimates), we identify ranges and cite primary sources so readers can evaluate methodology and timing.
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