A number of U.S. states are either highly vulnerable to, or have already entered, an economic downturn, according to Moody’s Analytics Chief Economist Mark Zandi.
“Based on my assessment of various data, states accounting for nearly one-third of U.S. GDP are either in recession or at high risk of falling into one,” Zandi wrote on X Sunday. “Another third are just holding steady, and the remaining third are expanding.”
Zandi has been among the most prominent economists warning about the fragility of the U.S. economy. Earlier this month, he said the nation as a whole was on the “precipice of recession,” citing weak data in spending, jobs, and manufacturing. He has attributed much of the strain to tariffs—calling them “increasingly cutting into the profits of American companies”—as well as to persistent softness in housing.
Zandi’s breakdown shows that 21 states and the District of Columbia are already in recession or face high risk, 13 states are “treading water,” and 16 are expanding. He noted that New York and California—two major indicators of the broader economy—are “holding their own.”
Zandi’s assessment, from strongest to weakest:
- Recession/High Risk: Wyoming, Montana, Minnesota, Mississippi, Kansas, Massachusetts, Washington, Georgia, New Hampshire, Maryland, Rhode Island, Illinois, Delaware, Virginia, Oregon, Connecticut, South Dakota, New Jersey, Maine, Iowa, West Virginia, District of Columbia.
- Treading Water: Missouri, Ohio, Hawaii, New Mexico, Alaska, New York, Vermont, Arkansas, California, Tennessee, Nevada, Colorado, Michigan.
- Expanding: South Carolina, Idaho, Texas, Oklahoma, North Carolina, Alabama, Kentucky, Florida, Nebraska, Indiana, Louisiana, North Dakota, Arizona, Pennsylvania, Utah, Wisconsin.
“Many of these states lean heavily on farming or on import and trade activity. Those are exactly the industries most exposed under current trade policies,” Kevin Thompson, CEO of 9i Capital Group and host of the 9innings podcast, said.