Delaware Economy: Corporate Charters, Banking, and DuPont's Legacy

Delaware is the second-smallest U.S. state by area and one of the smallest by GDP — the dollar value of everything a place makes and sells in a year. The Delaware economy is unusually concentrated in finance, corporate legal services, chemicals and biotech, and a deep base built on its national role as the legal home of more than half of all U.S. publicly traded companies.

This is a plain-English tour. For the national picture, see The State of the U.S. Economy and the Economy hub.

How big is the Delaware economy?

For example, recent state GDP for Delaware has run around $90 billion, according to the Bureau of Economic Analysis. Population is roughly 1.0 million, per the U.S. Census Bureau. Wilmington, Dover, and the coastal beach towns of Sussex County anchor three very different regional economies.

The biggest industries

Delaware's industry mix is unusually skewed toward finance and legal services. The main pillars are:

• Banking and credit cards — Delaware's 1981 Financial Center Development Act made it a magnet for national credit card operations. JPMorgan Chase, Capital One, Bank of America, and Discover all run major credit card and consumer banking sites in or near Wilmington.
• Corporate legal services and incorporation — more than two-thirds of Fortune 500 companies are incorporated in Delaware, and the state's Court of Chancery is the dominant U.S. forum for corporate law disputes. The associated legal, registered-agent, and corporate services industry is significant.
• Chemicals and pharmaceuticals — DuPont (now split into DuPont, Corteva, and Chemours), AstraZeneca's U.S. headquarters, and a deep base of pharmaceutical and biotech firms anchor a long industrial chemistry tradition.
• Healthcare — ChristianaCare, based in Newark, is the largest private employer in the state.
• Agriculture and food processing — Sussex County is one of the largest U.S. broiler chicken producing areas; Perdue Farms and Allen Harim are major employers.
• Tourism — the Delaware beaches (Rehoboth, Lewes, Bethany) draw a major summer visitor economy, especially from Washington, D.C., Baltimore, and Philadelphia.

Jobs and wages

Delaware labor data is published by the Delaware Department of Labor, with national-level numbers from the Bureau of Labor Statistics. For example, the Delaware unemployment rate has typically run close to the national average, with Wilmington and Dover usually a little tighter than Sussex County.

The Delaware minimum wage is being phased up to $15.00 per hour, well above the federal floor of $7.25.

Taxes in Delaware

Delaware has a graduated state income tax with moderate top rates.

Delaware is one of just a few U.S. states with no statewide sales tax, which has historically attracted out-of-state shoppers from Pennsylvania, Maryland, and New Jersey. The state instead relies more heavily on a gross receipts tax on businesses, franchise taxes on Delaware-incorporated companies, and personal income tax. State tax forms and rules live at the Delaware Division of Revenue. You can read more about how sales tax works in our glossary.

Cost of living

Cost of living in Delaware is around the national average. Wilmington and the southern beach towns are the priciest; Dover and inland Sussex County are more affordable. The federal government tracks region-specific Consumer Price Index data through the BLS Mid-Atlantic region, and HUD publishes Fair Market Rents for every county at HUD User.

The corporate charter business

Delaware's outsized national role rests on a deep, century-long body of corporate case law and a specialized Court of Chancery that handles business disputes without juries. Companies pay a franchise tax to remain incorporated in Delaware, and the state collects more than a billion dollars a year from those fees. The associated cluster of corporate law firms, registered agents, and corporate services providers concentrated in Wilmington is unmatched in the country.

Banking and credit cards

The 1981 Financial Center Development Act effectively eliminated state usury caps for banks chartered in Delaware. National banks responded by relocating credit card operations to the state, and the resulting cluster has been a stable base of high-skill back-office and analytical employment for more than four decades.

DuPont's legacy and the chemical corridor

DuPont's headquarters and research presence in Wilmington made the city one of the most chemistry-intensive in the country for most of the twentieth century. The company's split into DuPont, Corteva (agriscience), and Chemours (specialty chemicals), plus AstraZeneca's large U.S. base in Wilmington, have kept the chemical and life sciences cluster substantial.

How does the Delaware economy fit into the national picture?

Delaware is one of the most finance- and legal-services-dependent state economies in the country, with national-scale roles in corporate incorporation, credit cards, and chemistry that are far out of proportion to its size. The state budget is unusually exposed to corporate franchise taxes and the broader health of the financial services sector.

A note on the numbers

Numbers in this article change every quarter — always check the latest from BEA, BLS, and the Delaware Division of Revenue for the most current data.