As rampant inflation and high interest rates keep the U.S. economy in flux, some areas are weathering the storm better than others.
A new study of GoBanking Rates analyzed local economies across the country to determine the top 15 states that thrived and those that failed.
The findings showed that the South appeared to have the most difficulty recovering from the years of uncertainty caused by the pandemic.
Southern states that were among the fifteen “failing” economies were: Louisiana, Mississippi, Arkansas, Kentucky, West Virginia, Oklahoma, and Tennessee.
A handful of Midwestern states also ranked among the bottom 15 economies, including: Illinois, Michigan, Ohio, Iowa and Indiana. California, New Mexico and Oregon were also listed.
As rampant inflation and high interest rates keep the US economy in flux, some states appear to be weathering the storm better than others
In contrast, the most booming economies were more dispersed. Utah, Idaho, Virginia, Colorado, Washington, Alaska and Arizona were among those in attendance.
The study also included DC because it is a “significant economy” despite not being a state. DC was on the list of ‘thriving’ local economies.
To determine how well a state was doing, researchers looked at four data sets: March 2024 unemployment rates, GDP growth between the third and fourth quarters of 2023, average weekly wages in the first three months of 2023, and the percentage of the population below the border. poverty line in 2022.
Some areas may struggle to ever properly recover from the pandemic, experts say.
Louisiana, for example, has consistently emerged as one of the worst-performing U.S. economies in recent years.
Xavier University economics professor Jose Bautista explained Axios last summer: “The bottom line is that the state really hasn’t recovered from the pandemic. And No. 2, the hurricane seasons since the pandemic haven’t helped either.”
The state is also vulnerable to catastrophic weather following hurricanes Ida, Laura, Delta and Zeta, among others.
Meanwhile, Utah is an example of recovery since the pandemic, thanks to several factors, including its relative stability before the health crisis and the diversity of its economy.
It comes after the national economy got a boost Thursday when the Dow Jones Industrial Average hit a milestone.
The index crossed the 40,000 point mark for the first time ever, surpassing a previous record set on Wednesday.
The other two major indexes – the S&P 500 and Nasdaq – also reached record highs on Wednesday.
Investors reacted positively to the news that annual inflation cooled slightly from 3.5 percent to 3.4 percent in April. The figures, released by the Bureau of Labor Statistics, raised hopes that the Federal Reserve will cut interest rates in September.
Inflation must cool before the Fed can cut interest rates, which are currently at a 23-year high of between 5.25 and 5.5 percent.
Southern states that were among the fifteen “failing” economies were: Louisiana, Mississippi, Arkansas, Kentucky, West Virginia, Oklahoma, and Tennessee. In the photo: the skyline of New Orleans, Louisiana
In contrast, the most booming economies were more dispersed. Utah, Idaho, Virginia, Colorado, Washington, Alaska and Arizona were among those in attendance. Pictured: Salt Lake City, Utah
Higher rates are intended to control consumer spending by reducing demand, which lowers prices.
The Fed has a clear goal of bringing annual inflation to 2 percent.
At the start of the year, economists had predicted that officials would cut interest rates up to four times.
But persistently higher-than-expected inflation rates have called that plan into question.
| Stands | Unemployment rate March 2024 | GDP growth Q3 2023 – Q4 2023 | Average weekly wages Q1 2023 | % of population below the poverty line in 2022 |
|---|---|---|---|---|
| FAILED | ||||
| Louisiana | 4.40% | 3.20% | $1,107 | 18.70% |
| Mississippi | 3% | 4.20% | $927 | 19.20% |
| Illinois | 4.80% | 3.60% | $1,346 | 11.80% |
| Arkansas | 3.50% | 3.10% | $1,036 | 16.20% |
| Kentucky | 4.50% | 4.10% | $1,092 | 16.10% |
| Michigan | 3.90% | 3.80% | $1,228 | 13.10% |
| West Virginia | 4.30% | 5.90% | $1,044 | 16.80% |
| Ohio | 3.80% | 4.30% | $1,185 | 13.30% |
| Oregon | 4.20% | 4.30% | $1,301 | 11.90% |
| Oklahoma | 3.50% | 4.10% | $1,052 | 15.20% |
| Tennessee | 3.20% | 4.80% | $1,199 | 14% |
| New Mexico | 3.80% | 6.10% | $1,096 | 18.30% |
| Iowa | 2.90% | 1.10% | $1,112 | 11.10% |
| Indiana | 3.50% | 5.00% | $1,115 | 12.30% |
| California | 5.30% | 4.80% | $1,613 | 12.10% |
| HEALTHY | ||||
| Utah | 2.80% | 6.70% | $1,195 | 8.50% |
| Idaho | 3.30% | 7.70% | $1,068 | 11% |
| District of Columbia | 5.20% | 3.80% | $2,159 | 15.10% |
| Virginia | 2.90% | 5.50% | $1,383 | 10% |
| Colorado | 3.70% | 5.10% | $1,431 | 9.60% |
| Washington | 4.80% | 5.90% | $1,682 | 9.90% |
| Alaska | 4.60% | 6.30% | $1,328 | 10.50% |
| Arizona | 3.80% | 6.80% | $1,248 | 13.10% |
| New Hampshire | 2.60% | 5.60% | $1,350 | 7.30% |
| Wyoming | 2.80% | 3.70% | $1,111 | 10.70% |
| Massachusetts | 2.90% | 5.00% | $1,643 | 9.90% |
| North Dakota | 2.00% | 2.00% | $1,205 | 10.80% |
| South Carolina | 3.10% | 6.80% | $1,086 | 14.40% |
| Maine | 3.30% | 5.90% | $1,129 | 10.90% |
| Florida | 3.20% | 7.00% | $1,218 | 12.90% |