Written By Lexx Thornton
While official data paints a picture of robust national growth, a closer look at the American economy reveals widespread weakness, with nearly a third of states at high risk of recession, according to Moody’s Analytics Chief Economist Mark Zandi.
The current economic landscape is marked by a sharp divergence: the national Gross Domestic Product (GDP) continues to grow at a healthy pace, but the recovery is unevenly distributed.
Mark Zandi’s recent analysis highlights this geographic disparity:
- Recession Risk: A startling 22 states and Washington, D.C.—representing almost one-third of the nation’s total economic output (GDP)—are either already experiencing an economic downturn or are at a high risk of one.
- Stagnation: Another third of states are merely “treading water,” showing little meaningful growth.
- Fading Momentum: The remaining states are still expanding, but even their momentum is slowing down.
To economists like Zandi, this state-level distress suggests the U.S. remains highly vulnerable to a nationwide downturn, with persistent inflation, a softening labor market, and declining consumer confidence weighing heavily on forecasts.
Zandi argues that the fate of the national economy largely rests on the performance of the California and New York economies. While neither is in a recession, both are struggling to build steam.
