With most states starting to reopen some non-essential businesses but state economies reeling from the loss of revenue and the massive unemployment caused by COVID-19, WalletHub today released updated rankings for the State Economies Most Exposed to 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 14 key metrics. The data set ranges from the share of employment by small businesses to the share of a state’s GDP coming from highly affected industries to access to paid sick leave. Below, you can see highlights from WalletHub’s report, as well as a Q&A with WalletHub analysts.
|States with Most Exposed Economies||States with Least Exposed Economies|
|1. Florida||42. Iowa|
|2. Louisiana||43. Oregon|
|3. Mississippi||44. Arkansas|
|4. Kentucky||45. Utah|
|5. New York||46. Alaska|
|6. District of Columbia||47. Idaho|
|7. Georgia||48. Wyoming|
|8. Virginia||49. Missouri|
|9. Illinois||50. Nebraska|
|10. Maryland||51. North Dakota|
- New York has the highest share of small businesses with temporary closings of business locations, 51.40 percent, which is 3.3 times higher than in Arkansas, the lowest at 15.60 percent.
- Montana has the highest share of employment from small businesses, 65.20 percent, which is 1.6 times higher than in Nevada, the lowest at 42.00 percent.
- Mississippi had the lowest share of the population working from home prior to the pandemic, 2.30 percent, which is 3.3 times lower than in Colorado, the highest at 7.70 percent.
- Mississippi has the lowest share of households with a broadband internet subscription, 46.80 percent, which is 1.7 times lower than in New Hampshire, the highest at 78.80 percent.
To view the full report and your state’s rank, please visit: https://wallethub.com/edu/state-economies-most-exposed-to-coronavirus/72631/
Will the states whose economies are most exposed to COVID-19 be able to recover quickly now that the reopening process has begun?
“Despite the fact that most states are starting to reopen non-essential businesses, we will not see rapid economic recovery until we have a vaccine for COVID-19. Since we don’t have a way to immunize people against the virus yet, the reopening process will be slow, as most states are only opening a few types of businesses at a time, often at partial capacity,” said Jill Gonzalez, WalletHub analyst. “States with the most exposed economies to coronavirus are usually those that rely heavily on highly-affected industries like entertainment, travel and tourism, which have been forced to make massive layoffs and lack revenue for rehiring. Businesses in vulnerable industries that do have the resources to rehire workers likely won’t do so right away, as many customers will stay away until the pandemic has fully subsided.”
What makes one state’s economy more exposed to coronavirus than another state’s economy?
“This pandemic has hit a number of industries so hard that they are furloughing at least 90 percent of their employees and going to zero revenue. Some states have a higher concentration of jobs in those industries or a higher share of state GDP from those industries than others,” said WalletHub analyst Jill Gonzalez. “WalletHub’s study used 14 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. Highly affected industries include accommodation and food services; arts, entertainment and recreation services; retail businesses and others.”
Why does Florida have the most exposed economy?
“Florida’s economy is most exposed to coronavirus hardship because prior to the pandemic it had a high share of employment in some of the most impacted industries, including real estate, accommodation and food services,” said WalletHub analyst Jill Gonzalez. “Florida 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 4.6 percent of its general fund expenses for 2020.”
Why does North Dakota have the least exposed economy?
“One reason why North Dakota’s economy is least exposed to harm from the coronavirus is that only 19.6% of its businesses have experienced temporary closures during the pandemic, one of the lowest rates in the country,” said WalletHub analyst Jill Gonzalez. “In addition to a low rate of business closures, North Dakota has seen one of the smallest reductions to workers’ earnings during the COVID-19 pandemic.”