23 US states at high risk of recession

US GDP is made up of many smaller, distinct state economies that fuel national growth.

In 2025, states responsible for about a third of US GDP were in recession or at high risk of recession, according to visualcapitalist.com. Another third of US states, however, are expanding, including Florida and Utah, as data on wages, employment and other key economic figures indicate.

The cited source presents the risk of recession by US state in 2025, based on an analysis by Mark Zandi, chief economist at Moody's Analytics. He shows that, as of October, 23 US states were at high risk of recession or were already in recession, while at the opposite end, 16 states, including Texas and Kentucky, are expanding.

• Where is the greatest risk of recession

To see the risk of recession, Zandi analyzed economic activity at the state level. This included a series of data such as unemployment, building permits, retail sales, industrial activity, crime rates and tax revenues. Then, based on these factors, states were classified into three categories: in recession/high risk; on the verge of expansion; in expansion.

Many coastal states in the Northeast are currently facing some of the most difficult economic conditions. In Maine, for example, annual GDP growth was only 0.8% in the second quarter of 2025, compared to the US average of 2.1%. At the same time, the unemployment rate in Washington, D.C. was 6.4% in July, significantly higher than the US average of 4.6%, given the drastic cuts in federal spending.

According to Zandi's analysis, New York and California are "on the mend,” together accounting for more than 22 percent of U.S. GDP.

By comparison, Texas, which accounts for 9.4 percent of U.S. economic growth, is booming. The 4 percent unemployment rate in July remains below the U.S. average. In addition, Texas' economy is growing faster than the U.S., while income growth was 6.3 percent annually in the second quarter of 2025, outpacing the national average.