Is the United States in a Recession? Why 22 States Are Already Sounding the Alarm

While the United States hasn’t officially declared a recession at the national level, the economic picture becomes far more complex when examining individual state performance. According to recent analysis from leading economists, a significant portion of America’s economy is already showing recession characteristics or facing imminent risk.

Mark Zandi, chief economist at Moody’s Analytics, provided a sobering assessment of the country’s fragmented economic landscape. His research reveals that states representing nearly one-third of U.S. gross domestic product are either currently in recession or at elevated risk. This finding underscores a critical reality: the health of individual state economies has become essential to understanding whether the United States will ultimately avoid a broader downturn.

A Nation Divided: State-Level Recession Risk Reshapes the Economic Picture

The recession risk analysis demonstrates that economic weakness isn’t confined to specific regions but rather scattered across the nation in unpredictable patterns. Some states are already experiencing visible signs of economic contraction, while others have entered a plateau phase following periods of stronger growth.

Geographic disparities tell an important story. The Washington D.C. region faces particular pressure from government employment reductions, which disproportionately affect the local economy. Southern states, though currently the strongest performers, show concerning signs of growth deceleration. Two major economic powerhouses—California and New York—together represent more than 20% of the nation’s total GDP. Their ability to maintain economic stability is crucial; any significant downturn in these states could substantially increase recession risk for the United States as a whole.

Which States Are Most Vulnerable to Economic Decline

Twenty-two states are currently classified as either in recession or at high recession risk. These states are ranked according to relative economic strength, though all are confronting substantial economic headwinds:

1. Wyoming
2. Montana
3. Minnesota
4. Mississippi
5. Kansas
6. Massachusetts
7. Washington
8. Georgia
9. New Hampshire
10. Maryland
11. Rhode Island
12. Illinois
13. Delaware
14. Virginia
15. Oregon
16. Connecticut
17. South Dakota
18. New Jersey
19. Maine
20. Iowa
21. West Virginia
22. District of Columbia

What This Means for the Broader U.S. Economy

The collective economic output of these 22 states represents a substantial share of national GDP, making their trajectory significant for the entire country. The recession challenge facing these states illustrates a broader vulnerability: the United States economy is not uniformly strong. Pockets of weakness across multiple states could combine and amplify, potentially triggering the broader recession that has seemed imminent.

The state-by-state analysis reveals that economic resilience is no longer guaranteed even in traditionally stable regions. Whether the United States experiences an actual recession now depends partly on whether these vulnerable states can stabilize before weakness becomes contagious across state borders.