Special Report

State Economies Hit Hardest by COVID-19

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11. Alabama
> 1-year GDP change: -1.8%
> Fastest growing industry: Utilities (+6.7%)
> Fastest shrinking industry: Arts, entertainment, and recreation (-36.4%)
> Nov. 2020 unemployment rate: 4.4%

Economic output totaled $197.7 billion in Alabama in Q3 2020, down 1.8% from $201.4 billion one year earlier. Despite the annual decline, Alabama’s economy has improved from its COVID-19 trough. In Q2 of 2020, Alabama’s GDP was only $183.6 billion — a low not previously seen in the state in over half a decade.

While economic output fell in most industries in Alabama in the past year, some still managed to grow. The state’s utilities, finance, and manufacturing sectors all generated more output in Q3 2020 than they did the previous year.

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12. Indiana
> 1-year GDP change: -1.9%
> Fastest growing industry: Agriculture, forestry, fishing and hunting (+28.4%)
> Fastest shrinking industry: Arts, entertainment, and recreation (-27.6%)
> Nov. 2020 unemployment rate: 5.0%

Due to the COVID-19 pandemic, few industries have expanded in the United States over the past year. One that defied the broader economic collapse, however, was agriculture, forestry, fishing and hunting. In Indiana, that industry expanded by 28.4%, more than in any other state other than Illinois and well above the comparable 6.7% national industry growth.

Still, Indiana’s economy contracted by 1.9% over the last 12 months. Expansion in industries like agriculture was offset by steep declines in others that were harmed far more by the pandemic, including arts, entertainment, and recreation and oil and gas extraction.

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13. Mississippi
> 1-year GDP change: -1.9%
> Fastest growing industry: Utilities (+18.4%)
> Fastest shrinking industry: Arts, entertainment, and recreation (-32.9%)
> Nov. 2020 unemployment rate: 6.4%

Mississippi’s economy contracted by 1.9% between Q3 2019 and Q3 2020, a smaller contraction than most states reported over the same period. The state’s economic fallout during the COVID-19 pandemic was mitigated by strong growth in its utilities sector, which expanded by 18.4% over the same period — stronger growth than in any other state.

Unlike most other sectors, utilities were not especially exposed to a slowdown during the pandemic. Nationwide, the utilities industry reported a 5.2% growth in the past year.

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14. Oregon
> 1-year GDP change: -1.9%
> Fastest growing industry: Agriculture, forestry, fishing and hunting (+11.0%)
> Fastest shrinking industry: Arts, entertainment, and recreation (-49.9%)
> Nov. 2020 unemployment rate: 6.0%

Oregon is one of only 16 states to not report a GDP decline of 2% or more from Q3 2019 to Q3 2020. The state’s smaller than average economic contraction was due in part to the relative resilience of manufacturing, one of its largest sectors. Over the past year, the manufacturing sector in Oregon contracted by just 0.3%, one-third of the industry’s overall decline nationwide.

Though the COVID-19 pandemic’s impact on Oregon’s GDP was relatively small, its impact on employment in the state was anything but. There were nearly 158,000 fewer people working in Oregon in November 2020 than at the same time in 2019. The 7.8% decline in employment is the 11th largest of any state.

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15. Maryland
> 1-year GDP change: -1.9%
> Fastest growing industry: Agriculture, forestry, fishing and hunting (+14.6%)
> Fastest shrinking industry: Arts, entertainment, and recreation (-45.5%)
> Nov. 2020 unemployment rate: 6.8%

Over the past year, the government sector, Maryland’s largest by GDP, expanded by 1.2%, even as the government sector shrank by 2.1% nationwide. Partially as a result, Maryland’s economy contracted by just 1.9% between Q3 2019 and Q3 2020, a smaller economic decline than most states reported over that period.

Still, industries like accommodation and food services as well as arts, entertainment, and recreation reported staggering declines. They also likely account for much of the state’s current jobless crisis. Maryland’s November 2020 unemployment was at 6.8%, double the 3.4% jobless rate one year earlier.