The United States, as much of the world after 2020, has suffered from significant economic harm due to the COVID pandemic, the subsequent lockdowns and general reduction on demand the world suffered. In the United States, unemployment rate went from a historic low of 3.5% in January 2020 to a whopping 14.8% in April same year, according to the U.S. Bureau of Labor Statistics (BLS).
Although there are more people going to work today than in April, the unemployment rate has yet to recover from COVID, standing at 6.2%, which Cecilia Rouse (Chair of the Council of Economic Advisers) says it is very likely to be undercounting the total amount of people who remain without a job, as it does not report the people who are not currently looking for a job.
However, judging the economic luck of the whole nation by only focusing on one number would not take into account that there are some significant regional variances within the country, as some states are doing far worse than others in terms of unemployment and economic output. More than 25 states have a unemployment rate that is significantly lower than the national average, while a dozen states are performing worse than the national average.
Tellingly, out of the 13 states (and D.C) who are having a worst rate of unemployment than the national average, twelve of them have Democratic governors. On the other hand, 20 of the 27 Republican governors are ruling states that have a unemployment rate that is lower than the national average, with only Massachusetts (with is surprisingly governed by a Republican) having a worst rate than the national average.
Hawaii, California, and New York top unemployment chart
As of today, Hawaii is the state with the worst unemployment rate in the country. According to data of the BLS, in January Hawaii had an unemployment rate of 10.2%, with unemployment being stabilized around the 10% level since Novemeber 2020, when the data went down from the 15% mark it acheived right after the pandemic.
The data on Hawaii is not surprising, after all, the island relies heavily on tourism, an industry that has been heavily affected by the travel restrictions and general decrease on travel spending caused by the pandemic. In fact, employment on the leisure and hospitality sector has been hit the hardest in the island, experiencing a 42% decrease when compared with the data on January 2020.
New York and California, closely follow the disparaging data from Hawaii. With the Empire state having a 8.8% unemployment rate and California an equally daunting 9% unemployment rate. Both states have famously implemented harsh COVID restrictions since the pandemic started, with many businesses in New York still having to operate at 50% capacity and California having the majority of its population (more than 80%) under the “red” tier of COVID restrictions, with some non-essential business operations still closed .
The rest of the states that are experiencing a higher than average level of unemployment than the national average are: Washington, Nevada, Louisiana, Illinois, New Jersey, Pennsylvania, Connecticut, Massachusetts, and the District of Columbia.
South Dakota, Utah, and Vermont have the lowest rates of unemployment
While California and New York continue to have very high rates of unemployment, there are a slew of states where unemployment is significantly lower, with many states even getting pass the 3.5% unemployment rate pre-COVID. While Big states like Florida and Ohio have managed to get their rate more than a point lower than the national average, the true protagonists of economic recovery in the country are smaller, less known states.
South Dakota has one of the smallest rates of unemployment in the country, with only 3.1% of the labor force being unemployed, the state never issued statewide stay-at-home orders during the COVID pandemic, implementing few to none restrictions to business in the state. Gov. Kristi Noem, a rising star in the Republican Party, will definitely use both facts as talking points if she ever decides to run in 2024.
Utah, a state also governed by a Republican, is tied with South Dakota by also having the lowest rate of unemployment in the country. According to BLS data, Utah also has a 3.1% unemployment rate, an impressive feat from a state that has been one of the economic rising stars of the nation.
Vermont, surprisingly governed by a Republican, has also experienced a significant decrease on unemployment, with only 3.2% of those who are actively looking for a job being unable to find one. The state, also showed a rapid recovery on their employment statistics compared to many states of the union, with the unemployment rate falling below 5% on September last year.
Republican states are more likely to have lower unemployment than Democrats
There are 27 states where the governor’s mansion is controlled by the GOP, with the remaining 23 on the hands of Democrats. When comparing this data with the unemployment level of each state we note that the states that are suffering the worst rates of joblessness are overwhelmingly governed by Democrats.
20 of the 27 states governed by the GOP have unemployment rates that are signifcantly lower than the national average, 6 are within one percentage point of the average, and only one (Massachussets) has an unemployment rate higher than the national average.
On the other hand, 11 of the 23 states ruled by Democrats have higher than average unemployment rates, 6 are within the average, and only 6 have rates that are significantly lower than the national rate.
In perspective, 74% of GOP states have better employment numbers than the national average, while only 26% of states governed by Democrats can brag on the same thing. Where Democratic governors can brag is on registering a worst than average record on employment, as almost 48% of states ruled by the party have jobless rates that are significantly higher than the national 6.3% rate.
The COVID pandemic brought a difficult dilemma for decision-makers, with heavy lockdowns in one side and no restrictions on the other, a choice between public health or the economy. With most authorities trying to find the ideal balance between a healthy and productive population.
While the jury is still out on the public health front, in the economy the judgement is clear: Republicans did better than Democrats.