23 US States Are At High Risk Of (Or In) Recession Currently

WikiFX

| 2025-12-22 22:25

Abstract：U.S. GDP is made up of many smaller, distinct state economies fueling national growth.In 2025, state

U.S. GDP is made up of many smaller, distinct state economies fueling national growth.

In 2025, states responsible for about a third of U.S. GDP are in recession, or face high recession risk.

Another third are expanding, including Florida and Utah, based on payrolls, employment, and other key economic data.

This graphic, via Visual Capitalist's Dorothy Neufeld, shows recession risk by state in 2025, based on analysis from Mark Zandi, chief economist at Moodys Analytics.

Where Recession Risk is Highest in America

To analyze recession risk, Zandi looks at state-level economic activity. This included a range of data such as unemployment, building permits, retail sales, industrial activity, delinquency rates, and tax revenues.

States were then categorized into three buckets based on these factors as of October 2025:

In Recession/High Risk
Treading Water
Expanding

State/District	Business Cycle Status	Share of U.S. GDP (%)
Georgia	In Recession/High Risk	3.03
Montana	In Recession/High Risk	0.25
Wyoming	In Recession/High Risk	0.18
Michigan	In Recession/High Risk	2.44
Massachusetts	In Recession/High Risk	2.73
Mississippi	In Recession/High Risk	0.53
Minnesota	In Recession/High Risk	1.70
Kansas	In Recession/High Risk	0.80
Rhode Island	In Recession/High Risk	0.28
Delaware	In Recession/High Risk	0.34
Washington	In Recession/High Risk	3.02
Illinois	In Recession/High Risk	3.85
West Virginia	In Recession/High Risk	0.36
New Hampshire	In Recession/High Risk	0.42
Maryland	In Recession/High Risk	1.86
Virginia	In Recession/High Risk	2.66
South Dakota	In Recession/High Risk	0.25
Connecticut	In Recession/High Risk	1.27
Oregon	In Recession/High Risk	1.14
Iowa	In Recession/High Risk	0.86
New Jersey	In Recession/High Risk	2.93
Maine	In Recession/High Risk	0.33
District of Columbia	In Recession/High Risk	0.64
Missouri	Treading Water	1.54
Ohio	Treading Water	3.14
Hawaii	Treading Water	0.39
Arkansas	Treading Water	0.65
New Mexico	Treading Water	0.49
Tennessee	Treading Water	1.87
New York	Treading Water	7.92
Vermont	Treading Water	0.16
Alaska	Treading Water	0.24
Colorado	Treading Water	1.92
California	Treading Water	14.50
Nevada	Treading Water	0.86
South Carolina	Expanding	1.18
Texas	Expanding	9.41
Oklahoma	Expanding	0.92
Idaho	Expanding	0.43
Kentucky	Expanding	0.99
Alabama	Expanding	1.10
Indiana	Expanding	1.81
Nebraska	Expanding	0.63
North Carolina	Expanding	2.86
Louisiana	Expanding	1.11
Florida	Expanding	5.78
North Dakota	Expanding	0.26
Pennsylvania	Expanding	3.54
Arizona	Expanding	1.88
Wisconsin	Expanding	1.53
Utah	Expanding	1.02

Currently, many coastal, Northeastern states are facing some of the worst economic conditions.

In Maine, for instance, year-over-year GDP growth is just 0.8% as of Q2 2025, compared to the U.S. average of 2.1%. Meanwhile, Washington, D.C.s unemployment rate was 6.4% in July, significantly higher than the 4.6% U.S. average given sweeping federal cuts.

According to Zandis analysis, New York and California are “Treading Water”, together responsible for driving over 22% of U.S. GDP.

In comparison, Texas, which fuels 9.4% of U.S. economic growth is expanding. Unemployment rates of 4.0% in July remain below the U.S. average. Additionally, the Texas economy is growing faster than the nation, while income growth rose 6.3% annually as of Q2 2025, outpacing the national average.