Is the U.S. in Recession Now? Why 22 States Already Face Economic Decline

The United States isn’t officially in a recession, yet economic warning signs are flashing across the country. According to Mark Zandi, chief economist at Moody’s Analytics, nearly one-third of U.S. GDP is produced by states already experiencing recession conditions or operating at high risk of entering one. His analysis reveals a fragmented economic landscape where regional instability could trigger a broader national downturn.

The Recession Is Spreading Unevenly Across America

Zandi’s assessment demonstrates that recession risk isn’t localized — it’s a nationwide phenomenon affecting multiple regions simultaneously. While some states show clear signs of economic contraction, others are decelerating after periods of expansion. The situation varies dramatically by region:

Government sector challenges are particularly acute in the broader Washington D.C. area, where federal job cuts are weighing heavily on employment. Meanwhile, Southern states maintain relative strength, though their expansion rates are noticeably slowing. California and New York, which collectively represent over a fifth of total U.S. GDP, are holding their ground. Their continued stability remains critical to preventing the entire economy from tipping into recession.

Which 22 States Face the Greatest Risk?

These states — ranked from relatively strongest to weakest economic positions — are either already experiencing recession or hovering at dangerous risk levels:

Wyoming, Montana, Minnesota, Mississippi, Kansas, Massachusetts, Washington, Georgia, New Hampshire, Maryland, Rhode Island, Illinois, Delaware, Virginia, Oregon, Connecticut, South Dakota, New Jersey, Maine, Iowa, West Virginia, and the District of Columbia.

Despite ranking from stronger to weaker, all 22 face mounting economic pressure that could accelerate deterioration. Collectively, these states represent a substantial share of national GDP, making their economic trajectory crucial for the nation’s overall financial health.

What This Means for the Broader Economy

The concentration of recession risk across so many states suggests the U.S. economy is operating on fragile footing. Zandi’s warning underscores how interconnected modern economies are — weakness in one region amplifies pressures elsewhere. As he noted, states producing nearly a third of GDP are either in recession or at high risk, while another third are merely treading water rather than growing.

This regional weakness raises an urgent question: Is the U.S. in recession now, or is it simply postponing the inevitable? The answer may depend on whether California, New York, and the Southern states can maintain their current resilience, or whether their slowdown accelerates into contraction.