State Economies Most Likely to Be Crippled by COVID-19

Alabama ranks towards the middle of all states in a majority of measures related to recession risk. Some 16.8% of workers are employed in industries identified by Moody’s as high-risk, roughly in line with the 17.7% national figure. As of June 1, there were 371 COVID-19 cases per 100,000 people, the 22nd highest infection rate of any state.

One factor that may help Alabama weather the global economic slowdown is high consumer confidence. Alabama was one of the last states to issue a stay-at-home order, and it has since relaxed a number of coronavirus-related restrictions on businesses and individuals. According to a survey by market research firm Morning Consult, consumer confidence is currently higher in Alabama than in any other state.

According to analysis by Moody’s, industries like leisure and hospitality, transportation and warehousing, and employment services are among the most likely to suffer as a result of the coronavirus pandemic. In Tennessee, 20.3% of workers are employed in such high-risk industries, the fifth largest share of any state.

In other measures of exposure, however, Tennessee fares relatively well. There were 348 COVID-19 cases per 100,000 residents as of June 1, less than the national infection rate of 547 cases per 100,000. Unemployment claims filed since March 15, 2020, amount to 16.4% of the Tennessee workforce, the ninth smallest share of any state.

Nearly 20% of workers in South Carolina are employed in industries at high risk of a slowdown in the wake of the pandemic, a larger share than the comparable national figure of 17.7%. The higher share of workers exposed to the economic slowdown has contributed to a higher share of unemployment claims. Since mid-March, about 23% of the state’s labor force have filed for unemployment, a larger share than in most other states.

State government finances will also likely be hit harder than average in South Carolina. According to Moody’s analysis, in the event of a moderate recession, revenue will decline by nearly 20% in the state — a larger decline than in most other states.

Ohio ranks towards the middle of all states in a number of measures indicating recession risk. Some 17.0% of workers are employed in industries classified as high-risk, in line with the 17.7% national share. As of June 1, there were 308 confirmed COVID-19 cases in Ohio per 100,000 residents, less than the national infection rate of 547 cases per 100,000 Americans.

One factor putting Ohio at risk of a long-term recession is the high unemployment. Ohio had relatively high unemployment before the coronavirus pandemic and has reported a dramatic increase in unemployment over the past few months. The state reported an April unemployment rate of 16.8% — the sixth highest unemployment rate nationwide and up 12.7 percentage points from April 2019.

Few states are facing an unemployment crisis as severe as New Hampshire’s. The state’s unemployment rate stands at 16.3% — higher than in all but seven other states and the 14.7% national unemployment rate. That figure will likely only keep climbing as since mid-March, nearly 200,000 New Hampshire residents have filed for unemployment, or over one-quarter of the state’s total workforce.

While New Hampshire’s job market is suffering more than that of most other states, New Hampshire has not been hit particularly hard by the virus itself — especially compared to other Northeastern states. There have been just 345 known cases of the virus per 100,000 people, below the national average of 547 per 100,000 and well below the number of infections in nearby Connecticut, Massachusetts, New York, and Rhode Island.