Connecticut and 4 Other States Still Haven’t Recovered From the Great Recession
As surprising as it might be to those outside of coastal big cities, many communities still haven’t recovered from the Great Recession. In fact, entire states haven’t recovered from the recession, which officially ended in June 2009. The economy, in many areas, is booming right along. But even as unemployment numbers have continued to sink lower and job openings have risen, people were “left behind.”
Those people were a big reason Donald Trump was elected president. Though the Obama administration managed to right the ship after the housing and financial crises, millions of people are still stuck. They’re still out of work. Many aren’t making any more money than they were 10, 20, or even 50 years ago.
They blamed the Obama administration for that, perhaps justifiably so. And when Trump came knocking, promising he wouldn’t ignore these folks, they listened. But now we’re left wondering whether Trump’s administration can get America over the hurdle, so to speak. Or, in other words, can he devise a plan to help bring the recovery to the areas that were left behind?
A report from Bloomberg looked at which areas, states specifically, still haven’t fully recovered from the Great Recession. It identified five states in particular that have fallen behind, which we’ll dig into on the following pages. “Five states still haven’t regained their levels of gross domestic product from before the financial crisis, more than five years after the country as a whole hit that milestone,” the report reads. “Eight states are below prerecession levels of employment. And 15 have home prices that have yet to rebound fully.”
How exactly does Trump plan to get these stragglers over the hump?
The Trump economy
The Trump administration inherited a healthy economy. It wasn’t perfect, by any means, but it was an economy nowhere close to the disaster Barack Obama walked into.
It’s a good starting point. Using MAGAnomics, Trump and his team of policymakers have a chance to pick up the baton and run with it. The president was acutely aware many communities were still suffering — he made that a focal point of his campaign. After the people in many of those areas swept him into office, he has his chance to follow through on his promises to make them great again.
But if there’s one thing the Trump administration has been scant on, it’s detailed plans. The plans the administration rolled for health care and tax reform, for example, lack any kind of sophistication. Even his budget proposal contained a $2 trillion math error. Mostly, the plans involve cutting taxes on corporations and wealthier families — something that didn’t pan out well in Kansas — and the renegotiation or scrapping of trade deals.
We’ve seen Trump already step away from the Paris climate accords and drop the TPP. He’s also threatened action on NAFTA and to slap tariffs on a number of imported goods, all in an effort to boost domestic manufacturing.
But regarding the economy, by and large things are calm. The unemployment rate is low, and the stock market is up, as are the number of job openings. The question is whether Trump can use the momentum created under the previous administration to help the areas still awaiting recovery.
These are the five states that fit the bill, according to Bloomberg.
Wyoming is in a difficult spot. It has a very low population and is incredibly rural. As such, Bloomberg points out two interesting tidbits: Wyoming’s economy is the second-smallest in the nation, and roughly 25% of that economy relies on mining. The state is the nation’s largest coal producer, and with coal demand dropping Wyoming has taken a hit. The lack of big-time growth and major cities also means the economic rebound has been slow to arrive.
We’ll stay out west for our next state. Dare you take a gamble and guess what it is?
When the housing bubble burst, one area affected more severely than others was Las Vegas. Entire subdivisions lay vacant with abandoned, foreclosed, or incomplete homes. It was a mess. Home prices still haven’t returned to pre-recession levels, and Nevada’s GDP is still lagging behind, too. Interestingly enough, the state’s unemployment rate is lower than it was pre-recession, but we’re still waiting for other indicators to show improvement.
Next up is a state that seems to always be included on dreary lists like these.
Yes, Mississippi also makes an appearance on our short list. The state has been plagued by economic issues for a very long time, and the post-recession world hasn’t ushered in any changes. The change in GDP between the fourth quarter of 2007 and fourth quarter of 2016 was -0.8%. So, yes, Mississippi’s economy hasn’t even completed a full circle since the financial crisis. In addition to that, payrolls are down about 1.5%, meaning there are fewer jobs than before.
One state in New England has also been fighting to recover. Can you guess which one?
When you think of Connecticut, you don’t typically think of economic devastation. But here we are, nearly a decade after the Great Recession kicked off, and Connecticut has yet to fully recover. Many homeowners are still underwater on their mortgages — meaning they owe more money than their home is worth — and the state government can’t seem to solve its budget woes.
Our final state? It’s dry. It’s arid. And its economy, at one time, looked like it was ready to attract vultures.
If there’s a deep-red state out west (with the exception of Idaho, perhaps), it’s Arizona. Though the state is “purpling,” it still voted for Trump in 2016. And hopes are he can help turn things around because Arizona is still playing catch-up with the rest of the country. Like Nevada, Arizona was hit hard by the housing bust. Average home prices haven’t recovered, and many people remain underwater on their mortgages.