COVID-19 Economic Crisis: By State

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Key Findings

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Every state in the country is well down from its February employment levels. Thirty-seven states have lost over 5% of their jobs, and 39 states are still down more jobs than during the Great Recession.

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Thirty states added fewer jobs in September than they did in August, and 9 states lost jobs over the month.

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In every state, lower wage industries have lost far more jobs than high wage industries.
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The size of every state's economy shrunk in the first half of 2020 with declines in GDP ranging from 13% to 7.1%.

Every state in the country is well down from its February employment levels. A jobs comeback in May, and especially June, has fallen off in every subsequent month as COVID-19 spread to more parts of the country, the ripple effects of the initial economic carnage have spread, and federal government support lapsed. September saw the smallest jobs growth since the April collapse. Thirty states added fewer jobs in September than they did in August, while 9 states lost jobs. Nationally, the rate of job growth in September was less than half of what it had been in August.

All told, the country had lost 10.7 million jobs as of September, 7% off the pre-recession level. Net job loss since February was still worse than in the Great Recession for 39 states. Even the other 11 states have seen large losses. The state with the smallest drop in employment, Idaho, had lost 1.7% of its payroll jobs with Utah and Mississippi next at 2.2% and 2.7% respectively. Since the September jobs data were collected, unemployment insurance claims have continued at highly elevated levels, indicating that many people are still losing their jobs and confirming that progress to a healthy labor market is, at best, proceeding at a slow pace.

The need to nationally address the COVID-19 health crisis in order to address the country’s economic woes is evident. Even as formal shutdowns have been relaxed, relapses have required the return of tight restrictions, and individual’s valid concerns about their own health, and the health of their families and communities, have made them reluctant to return to pre-COVID activities. Earlier in the pandemic, state economic conditions were closely correlated with state COVID-19 incidence. As almost every state has now had a period of serious COVID-19 incidence, and economic harm has spread, the relationship has become less consistent. A regionally scattered health crisis is now national in scope as is the associated economic crisis. As long as the response leaves the numbers of cases at high levels in much of the country, the preconditions for a robust economic recovery will not exist for the country or any state.

In nearly every state, every industry is down jobs from February. Some industries in some states have rebounded completely, but those are the rare exceptions.

Official data on the overall level of economic activity lag employment data, but through the first two quarters of 2020 the Gross Domestic Product for every state declined, with all but four having worse drops than those seen in the Great Recession.

Map 1 compares states in the percent change in the number of payroll jobs between the Bureau of Labor Statistics (BLS) February survey and the September survey (covering payroll periods containing September 12). Selecting a state on the map will reveal data for the entire period and the latest month.

Net job loss in states has ranged from Hawaii and New York with 18.7% and 11.5% of jobs lost since February, respectively, to Idaho and Utah which have lost 1.7% and 2.2% of their jobs. Thirty-seven states have lost more than 5% of their jobs. August to September saw job increases in 40 states, but 30 of them saw slower growth than the prior month. Alarmingly, 9 states had fewer jobs in September than in August. No state has recovered its previously lost employment.

  1. Employment data used here are seasonally adjusted, meaning that the Bureau of Labor Statistics accounts for normal seasonal variation in employment due to various factors.
  2. Small differences between states in the percent job change may not be statistically significant.

The hardest hit sector nationally and in every state continues to be Leisure and Hospitality, in which the Accommodation and Food Services industry has lost 21.1% of its employment, or 3.0 million jobs, and the Arts, Entertainment and Recreation industry has lost 32.2%, or 800,000 jobs as of September. Hawaii has seen the biggest net drop in Accommodation and Food Services—down 58.8%, a loss of 66,700 jobs. 

Also very hard hit has been Administrative and Support and Waste Management and Remediation Services, which is in the Professional and Business Services sector. Nationally, the decline was 10.3% from February to September, with New York seeing the largest state drop at 19.3%. Most of the job losses in this industry were in Employment Services which includes employment search firms and the hard-hit area of temporary help services.

State and local government employment has fallen across the country. In the United States overall, state government employment has dropped 5.1% since February and local government employment by 6.4%. State and local governments combined have lost 1.2 million jobs since February. This includes the loss of 182,000 jobs from August to September—driven by cuts in education. Since February, the government of New Hampshire has reduced its employment by 17.9% according to these data. Local governments in Nevada reduced their employment by 14.0%.

As discussed more later, the labor intensive Health Care and Social Assistance industry has contributed greatly to total job losses in every state, though in percentage terms it has been less hard hit than the hardest-hit industries, nationally losing 5.0% of jobs as of September. 

Map 1 can display individual sectors and industries as well as employment for all sectors and industries. The table in addendum 1 shows a top-to-bottom ranking, sortable by percentage change, total employment change, and state name—it shows the change in jobs from February to September as well as August to September. The table can list employment for all sectors and industries, or individual sectors and industries. Descriptions of each sector and industry can be found on the BLS website.

Chart 1 compares (1) the change in number of jobs during the Great Recession (December 2007 to June 2009), (2) job loss in the current crisis, February to September, and (3) job change in each month from March through September. Comparisons can be viewed for the nation or a selected state, district, or territory as well as for total payroll employment or a selected sector or industry. 

In total employment, 39 states are down more jobs than they lost from their peak employment to their low point in the Great Recession. Forty-six states have lost more jobs than during the Great Recession in Accommodation and Food Services, 37 have lost more in Heath Care and Social Assistance, 40 have lost more in local government, and 30 have lost more in state government. 

  1. Employment data are seasonally adjusted.

Though no industry has returned to its pre-COVID level of employment nationally, with the exception of Federal government employment boosted by Census hires, a handful of industries in a few states have recovered—Finance and Insurance has returned to pre-recession levels in 18 states, for example.

Although overall the rate of recovery has fallen off dramatically through September, some industries have picked up their pace of recovery. In particular, nationally, the Financial Activities sector, including banking, real estate and insurance, had its best bump up since February, a gain of 37,000 jobs—though it is still down 162,00 jobs overall.

Chart 2 shows in stark fashion how catastrophic the job loss has been. Between February and April, in almost every state, all or most of the jobs gained since the Great Recession were lost. This is a sharp reversal from the steady climb that began in 2010, accelerated starting in 2012, and had slackened in the last few years. Since May there has been a rebound, but it is far short of the drop and the rate of progress has slowed. Also available in Chart 2, by selecting the tab above the graph, is a focused graph for only 2020. The chart is available for each state and for each industry.

The causes of the Great Recession and the current crisis are very different, and the paths to recovery will be different. Most obviously, the economic path is being significantly dictated by the success or failure in bringing COVID-19 under control. With cases on the rise, economic progress has slowed. The immediate path forward will depend on the national response to the COVID-19 disease and whether the federal government takes adequate steps to address the economic fallout.

  1. Employment data are seasonally adjusted.

 

Even in the best of circumstances, problems will certainly linger as some industries continue to face substantial headwinds and begin the recovery process significantly weakened. Until the risks of COVID-19 decline significantly, limitations on human contact such as social distancing, and understandable reluctance by consumers to resume all normal activities, will impinge on the operations of many industries. These factors will be a drag on the economy more broadly. Lower employment and reduced activity in any industry continue to spill over into other industries. In addition, many employers will be depleted or have ceased operations, and it will take some time to fully recover. The upward line in Chart 2 is not nearly as vertical as the downward line—and the difference has become more pronounced in recent months. How quickly we will come back is the critical economic question for coming months and years.

Chart 3 shows the changes in employment for the selected jurisdiction for each industry (or for some states, sector). In every state Accommodation and Food Services has contributed the most to job loss. Health Care and Social Assistance, and Administrative and Support and Waste Management Services have also been hard hit in every state. Within Health Care and Social Assistance, industry losses nationally have been mostly in Ambulatory Health Care Services and Social Assistance. Ambulatory Health Care Services includes physician and dentist offices which have been seen substantial losses. Social Assistance includes Child Day Care, which has seen an employment drop nationally of 18% as of September. Selecting the bars in the charts will show the job changes February to September and August to September.

  1. “SA” indicates that the data for the sector or industry are seasonally adjusted. “NSA” indicates that the data are not seasonally adjusted.

Chart 4 shows the relationship between job loss and average weekly wages for each industry. The overwhelming number of jobs lost have been in low-paying industries. Nationally, Accommodation and Food Service had lost over 3.0 million jobs (a 21% decline) as of September and had an average weekly pay of $433 in 2019. Health Care and Social Assistance had lost about 1 million jobs in this time period, Retail had lost 483,000 jobs, and Administrative and Support and Waste Management Services lost 969,000 jobs. These industries' average weekly pay nationally was $996, $646, and $828, respectively. Meanwhile, Management of Companies and Enterprises had lost fewer than 100,000 jobs, and Finance and Insurance was only down 4,000—with average weekly pay of $2,429 and $2,166, respectively.   

  1. Hourly pay levels are not available as comprehensively as weekly wages at the state level so they are not used here, but the pattern for hourly wages is similar to the pattern for weekly wages.

These wage levels are, of course, averages across a wide range of jobs within the industries. Finance and Insurance includes both the heads of Wall Street firms and bank tellers. It is clear, however, that job loss has been significantly more acute in low-wage jobs than high-wage jobs. 

Low-wage employees are obviously much more heavily impacted by job loss. They have less in savings, and those who had employer-provided health insurance are less likely to be able to afford continuing coverage. 

Table 1 shows the percentages of job loss for each industry in the country, selected state, district, or territory. Industries with more employees are, of course, more likely to contribute more greatly to the total numbers of job losses shown in Charts 3 and 4—just as larger states contribute the most to national job loss. From the perspective of an employee, customer, owner, or other stakeholder in an industry, the level of impact is measured best by the percent of jobs in the industry that have been lost. It is notable that, for the most part, the reason the most jobs have been lost in low-wage industries and the fewest in high-wage industries (as highlighted by Chart 4) is not just that low-wage industries employed more people prior to the current crisis. Higher paying industries, while certainly feeling an impact, have lost a much smaller share of their jobs. A waiter, for example, is much more likely to have lost his or her job than a banker. The Information sector has been an exception to this—a higher paying industry with a high percentage of jobs lost.

  1. “SA” indicates that the data for the sector or industry are seasonally adjusted. “NSA” indicates that the data are not seasonally adjusted.

Unemployment Rate

Map 2 shows the unemployment rate. This measure is less reliable than usual under current circumstances. It is a measure of those who are not employed as a share of those who are employed or seeking employment. How respondents respond to survey questions related to whether they are seeking employment in this unusual period is not consistent, which makes the unemployment rate less informative. There are other measures of unemployment, but they are not available by state on a monthly basis.

The highest unemployment rates in September were 15.1% in Hawaii, 12.6% in Nevada, and 11% in California. Clicking on a state in the map will show the rates for each month from February through September. The chart in Addendum 2 plots the unemployment rate from 2008 through September for the country or selected state, district, or territory.

  1. Employment data are seasonally adjusted.

Employment-to-Population Ratio

Chart 5 shows the Employment-to-Population Ratio (EPOP) so far in 2020. This is the percent of the population that is gainfully employed. For the country and most states, it has dropped significantly since February, although nationally the EPOP remained nearly flat between August and September. In the long run this measure is influenced by factors such as the aging of the population out of prime working years. The dramatic economic impact of COVID-19, however, currently dominates this measure. 

  1. Employment data are seasonally adjusted.

Overall Economic Activity

Economic activity, as measured by Gross Domestic Product, declined precipitously in the first half of the year. Map 3 shows the change from the last quarter of 2019 to the second quarter of 2020—the latest period for which data are available. Hawaii, Nevada, Michigan, and Tennessee were hardest hit—their economies shrinking by 13% or more.  Utah had the smallest decline for a state but still had an enormous drop of 7.1%. A sortable table is available in Addendum 3.

Chart 6 compares, for the selected state or the nation, the GDP loss in the Great Recession, the total GDP loss through the second quarter of 2020, and the changes seen in each quarter of 2020, separately. Every state had worse drops in the first half of 2020 than in the Great Recession except Michigan, Arizona, Florida and Arkansas. These states are distinctive from other states not because the impact on them of the current recession has been mild, but because they were four of the six hardest hit states in the Great Recession.

View Addendum 1: Sortable Jobs Table (Data through September 2020)

The table in Addendum 1 can be sorted by percent change in employment, change in the number of jobs, or alphabetically by state. Different sectors and industry can be selected. (Data through September 2020)

View Addendum 2: Unemployment Rate 2007 – September 2020

Addendum 2 shows the unemployment rate by month from January 2007 to September 2020, the most current month for which data are available. The national total or individual state, district, or territory can be selected.

View Addendum 3: Sortable GDP Table (2019 Q4 - 2020 Q2, Great Recession Peak to Trough)

Addendum 3 shows GDP change through the second quarter of 2020 and the drop in GDP during the Great Recession for each state. It can be sorted by either.

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