New York's economy is America's worst

New York's economy is America's worst

Posted: Jul 21, 2021 2:40 PM
Updated: Jul 21, 2021 2:40 PM

The US economy is inching back to normal. But the recovery remains uneven and some states are lagging behind in the race to get back to pre-pandemic strength — especially New York.

Although several states' economies have already fully recovered — and are even outpacing — their pre-Covid levels of economic activity, New York is by far the worst-performing state, according to the Back-to-Normal Index created by CNN Business and Moody's Analytics.

The index shows that the US economy as a whole was 93% back to normal as of June 18. But New York was only at 83%, leaving it with the furthest to go to get back into pre-Covid shape.

New York isn't the only state below the 90% mark, though it is at the bottom of the list.

How bad is the Empire State compared to the other 49 states?

In 2019, before Covid hit, New York had the third-strongest economy among US states, lagging only Texas and California. The state's gross domestic product — the broadest measure of economic activity — was nearly $1.8 trillion, on par with the GDP of Italy. More than $1 trillion of that came from economic activity in New York City. The state contributed more than 8% to America's overall GDP that year.

In 2020, New York's GDP dropped to $1.7 trillion. That might not sound like a big difference, but we're dealing in trillions of dollars here. When states that are economic powerhouses underperform, it's not great for the recovery of the entire nation.

New York's GDP contracted by 5.9% last year, a bigger decline than the total US GDP suffered, putting it at No. 47 out of all 50 states for economic growth.

The jobs situation looks even worse. At 7.8% unemployment, New York has one of the highest jobless rates in the nation. US unemployment as a whole stood at 6.1% in April and fell to 5.8% in May.

Why New York lags behind

The biggest factor is the scope of the economic destruction New York City suffered during the height of the pandemic, when it was the epicenter of the outbreak. This led to more severe lockdown protocols than in many other parts of the country.

On top of that, the New York City economy is heavily reliant on service-driven industries. But offices are still mostly empty, and only some workers are commuting. That's bad news for the coffee shops, dry cleaners and lunch spots that support the office infrastructure.

"More specific to New York City is also business travel and tourism that has just stopped," said Moody's Analytics' economist Matt Colyar. It's unclear when those travelers will return.

And the challenges don't end there: One of the components of the Back-to-Normal Index that holds New York back the most is the shortage of restaurant-goers, according to Colyar. The state is still 40% below its pre-pandemic, eat-in diner volume, while the nation as a whole is down only 13%.

"I think with New York lifting its restrictions last week, I would expect for some of that gap to close," Colyar told CNN Business.

The state has been more cautious than most in lifting restrictions to avoid new flare ups of the virus. But the scarring economic effect will be a factor for a while.

The-CNN-Wire
™ & © 2021 Cable News Network, Inc., a WarnerMedia Company. All rights reserved.

Minnesota Coronavirus Cases

Data is updated nightly.

Cases: 770246

Reported Deaths: 8661
CountyCasesDeaths
Hennepin1537491923
Ramsey63444980
Dakota57071526
Anoka54052520
Washington33690331
Stearns28419253
St. Louis23735361
Scott21652160
Wright21388171
Olmsted18144120
Sherburne15515115
Carver1366556
Clay1025399
Rice9985131
Blue Earth966659
Crow Wing9518109
Chisago837263
Kandiyohi835197
Otter Tail8061105
Benton7477111
Beltrami658079
Mower645541
Douglas629190
Goodhue619985
Itasca618885
Winona611854
McLeod595770
Steele585825
Isanti573074
Morrison557767
Becker534862
Polk512879
Freeborn487642
Nobles481652
Lyon456356
Carlton446866
Nicollet434454
Pine428532
Cass425745
Mille Lacs416967
Brown411547
Todd400036
Le Sueur386332
Meeker356854
Waseca327331
Martin326336
Wabasha29538
Hubbard292744
Dodge273510
Roseau265227
Fillmore243812
Redwood240443
Wadena238429
Houston231117
Renville228549
Faribault220630
Pennington217227
Sibley211612
Cottonwood197128
Kanabec192230
Chippewa190340
Aitkin184043
Watonwan171112
Pope16148
Yellow Medicine157220
Rock155319
Jackson147315
Koochiching138619
Clearwater136618
Murray135011
Swift134619
Marshall134520
Pipestone133427
Stevens124911
Lake109521
Wilkin102814
Lac qui Parle98524
Mahnomen90312
Norman8789
Big Stone7974
Grant7869
Lincoln7845
Kittson61122
Red Lake5899
Unassigned538124
Traverse5165
Lake of the Woods4764
Cook2460

Iowa Coronavirus Cases

Data is updated nightly.

Cases: 474151

Reported Deaths: 6785
CountyCasesDeaths
Polk74657729
Linn29194394
Scott24733274
Black Hawk20335358
Woodbury19207244
Johnson17988100
Dubuque15834229
Pottawattamie14276200
Dallas14109108
Story1288551
Warren774296
Cerro Gordo6951110
Webster6950111
Clinton6929101
Des Moines667594
Marshall641885
Muscatine6352113
Wapello5936137
Jasper578279
Lee565689
Sioux565676
Marion508191
Buena Vista491746
Plymouth463487
Henry389847
Jones370861
Washington366856
Benton359257
Bremer357168
Boone350937
Carroll346353
Crawford339347
Mahaska322856
Dickinson301052
Clay279133
Buchanan279039
Jackson273546
Kossuth271873
Hardin270249
Tama264976
Fayette260649
Delaware258546
Cedar249526
Page249328
Wright243645
Hamilton233954
Winneshiek233338
Floyd221845
Harrison217777
Madison216925
Clayton214558
Poweshiek211741
Iowa208029
Butler206638
Cass201557
Jefferson201040
Mills199929
Allamakee194753
Cherokee193844
Lyon192941
Hancock187639
Winnebago186633
Calhoun186116
Appanoose180850
Shelby178439
Louisa171052
Grundy168537
Humboldt167727
Emmet167146
Franklin164628
Mitchell164043
Union162637
Chickasaw159318
Sac157924
Guthrie155434
Montgomery142342
Palo Alto142032
Clarke141328
Keokuk139635
Monroe134335
Howard128222
Ida118641
Greene116315
Davis115225
Lucas113724
Pocahontas111423
Monona108738
Worth10818
Adair105335
Osceola94017
Fremont86111
Van Buren84221
Decatur82612
Taylor79713
Wayne74824
Ringgold67727
Audubon66814
Adams5095
Unassigned380
Rochester
Clear
37° wxIcon
Hi: 53° Lo: 35°
Feels Like: 34°
Mason City
Clear
36° wxIcon
Hi: 53° Lo: 35°
Feels Like: 29°
Albert Lea
Partly Cloudy
36° wxIcon
Hi: 53° Lo: 34°
Feels Like: 29°
Austin
Partly Cloudy
37° wxIcon
Hi: 53° Lo: 35°
Feels Like: 31°
Charles City
Clear
37° wxIcon
Hi: 53° Lo: 36°
Feels Like: 29°
Tracking mid-week rain
KIMT Radar
KIMT Eye in the sky

Latest Video

Image

Sean's Weather 10/25

Image

Saving the great blue heron rookery in Olmsted County

Image

Garten Marketplatz hosts Save the Rookery environmental group

Image

Strike out polio

Image

Strike out polio

Image

Unleash the She

Image

Save the Rookery Heronfest

Image

Full Forecast 10/24/21

Image

Remembering Ted Benda

Image

Century girls' swim team makes it to true team state

Community Events