The U.S. economy reported its worst quarterly decline in modern history during the COVID-19 pandemic, with gross domestic product shrinking at an annual rate of 31.4% in the second quarter. The economy bounced back in the third quarter, but efforts to contain the virus’s spread throughout 2020 still resulted in a 3.5% annual economic contraction in the United States.
Arriving on the heels of a historic period of growth, COVID-19 brought about a decline in gross domestic product in every state in the country. However, no two state economies are alike, and partially as a result, some states were hit far harder than others.
Texas’ economy contracted by 3.5% in 2020, in line with the comparable GDP decline nationwide. Texas is far and away the top oil-producing state, and as nonessential travel ground to a halt during the pandemic, demand for petroleum plummeted, putting pressure on oil prices. Though several industries in Texas contracted more than resource extraction, due to the industry’s size, it posed the largest drag on overall economic growth, detracting 1.7 percentage points from the state’s GDP.
Resource extraction also shed more jobs than any other industry in Texas in 2020, as overall employment in the sector declined by 22.8%. Partially as a result, unemployment in Texas stands at 6.7%, considerably higher than the 6.1% U.S. jobless rate.
States are ranked based on the percentage change in real GDP from 2019 to 2020. Data on GDP and industry-specific real GDP came from the BEA. Data on average annual employment and the seasonally adjusted monthly unemployment rate each came from the Bureau of Labor Statistics.
|Rank||State||Change in GDP, 2020 (%)||April 2021 unemployment (%)||Change in nonfarm employment, 2020 (%)|