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State Economies Hit the Most by Coronavirus – WalletHub Study

With vaccination efforts allowing states to reopen more and more but the unemployment rate still high at 6.2%, WalletHub today released updated rankings for the State Economies Hit the Most by Coronavirus, as well as accompanying videos.

To identify which states are most vulnerable economically, WalletHub compared the 50 states and the District of Columbia across 13 key metrics. The data set ranges from the share of employment from small businesses to the share of workers with access to paid sick leave and the increase in unemployment insurance claims. Below, you can see highlights from WalletHub’s report, as well as a Q&A with WalletHub analysts.

State Economies Hit the Most by COVID State Economies Hit the Least by COVID
1. Louisiana 42. Idaho
2. Oklahoma 43. Maryland
3. Hawaii 44. Minnesota
4. Ohio 45. Nebraska
5. Nevada 46. North Dakota
6. Alaska 47. District of Columbia
7. West Virginia 48. Utah
8. Virginia 49. Oregon
9. New Mexico 50. Arizona
10. Wyoming 51. Washington

Key Stats

  • Hawaii experienced the highest decrease in real GDP (2020 vs. 2019), at 8.01 percent, while Utah experienced the lowest decrease at 0.10 percent.
  • Montana has the highest share of employment from small businesses, 65.30 percent, which is 1.6 times higher than in Florida, the lowest at 41.70 percent.
  • Mississippi had the lowest share of the population working from home prior to the pandemic, 2.40 percent, which is 3.5 times lower than in Colorado, the highest at 8.30 percent.
  • Mississippi has the lowest share of households with a broadband internet subscription, 47.60 percent, which is 1.7 times lower than in New Hampshire, the highest at 79.30 percent.

To view the full report and your state’s rank, please visit:
https://wallethub.com/edu/state-economies-most-exposed-to-coronavirus/72631

WalletHub Q&A

What will the coming months be like for most state economies?

“State economies should be bolstered in the coming months through a combination of vaccination and the American Rescue Plan. As more people become eligible for the vaccine and receive it, states will continue to eliminate restrictions, which will lead to greater spending at businesses and a reduction in unemployment,” said Jill Gonzalez, WalletHub analyst. “The American Rescue Plan should work wonders for state economies, too, through a combination of individuals spending more due to their stimulus checks, businesses avoiding layoffs through PPP loans and states getting federal funding to replace lost tax revenue.”

What makes one state’s economy more exposed to coronavirus than another state’s economy?

“This pandemic has hit certain industries especially hard, such as accommodation and food services, entertainment and retail trade. Some states have a higher concentration of jobs in highly affected industries or a higher share of state GDP from those industries than others,” said WalletHub analyst Jill Gonzalez. “WalletHub’s study used 13 core metrics to measure the impact of COVID-19 on state economies, with the most weight going to the share of each state’s GDP and workforce that are from highly affected industries, along with the rate at which initial unemployment insurance claims are being made.”

Why has Louisiana’s economy been hit the most by coronavirus?

“Louisiana’s economy has been hit the most by coronavirus because prior to the pandemic it had a high share of employment in some of the most impacted industries, including oil and gas extraction; accommodation and food services; arts, entertainment and recreation; and retail trade,” said WalletHub analyst Jill Gonzalez. “Louisiana doesn’t have a lot of extra cash to fall back on during its financial troubles, as the state’s rainy-day fund is able to cover just 5.4 percent of its general fund expenses for 2021.”

Why has Washington’s economy been hit the least by coronavirus?

“One reason why Washington’s economy is hit the least by coronavirus is that it has the third best work from home infrastructure and one of the largest shares of workers working from home,” said WalletHub analyst Jill Gonzalez. “In addition to a good work from home infrastructure, Washington has seen one of the smallest reductions in Real GDP during the COVID-19 pandemic.”