On poverty, the damage was equally dispersed, although the patterns of distress were less uniform. From 2008 to 2010, the share of people living in poverty increased in every state except Montana (whose small improvement in its poverty rate was within the survey’s margin of error). In a dozen states, the proportion of residents living in poverty increased by at least 20 percent over just those two years; in another 25 states, the poverty rate increased by at least 10 percent. After this rapid deterioration, at least one in 10 residents are now living in poverty in every state except Alaska, Maryland (both registered a hardly comforting 9.9 percent), and New Hampshire (at 8.3 percent).
The picture is more mixed on access to health insurance. From 2008 to 2010, the share of residents without insurance rose in 35 states, with Hawaii, Rhode Island, Kansas, Virginia, and Kentucky experiencing the largest increases. In another 15 states, the percentage of uninsured people declined. But in each direction, most of the changes were quite small and in many cases within the survey’s margin of error (which varies by state). In no state did the pool of people without insurance increase or decrease by more than 1.8 percentage points. On health care, then, the overall picture is one of stagnation over the past two years.
At least 10 percent of residents are uninsured in all but nine states. Massachusetts—with just 4.4 percent, the lowest rate in the union—is the bookend to the unequaled 23.7 percent who are uninsured in Texas.
The trends in employment complete the picture of a continent-sized storm. From December 2008 through August 2011, the latest month for which BLS figures are available, the number of people with jobs declined in every state except three big energy producers: Texas (where employment increased a slim 0.4 percent), Alaska (up 1.9 percent), and North Dakota (up 7.2 percent). Nevada was the biggest loser: It has shed a stunning 8 percent of its jobs since 2008. Georgia and Arizona also suffered losses greater than 5 percent, followed by Alabama, North Carolina, Kansas, Delaware, California, and Indiana.
Measured in absolute rather than percentage terms, 10 states have lost at least 100,000 jobs since December 2008. Once again, the big losers cluster around the Sun Belt and the Rust Belt. In the former, they include California (by far the most affected with nearly 600,000 jobs gone), Florida (276,000 lost), Georgia (211,000), North Carolina, and Arizona. The big Rust Belt losers were Illinois, Ohio, Michigan, and Indiana. (Among the biggest losers, New Jersey is the only state to break that regional pattern.)
In parallel fashion, the unemployment rate increased over that same period in every state except North Dakota. As of August, nine states reported double-digit unemployment, most of them along the Sun Belt: from North Carolina, South Carolina, Mississippi, Georgia, and Florida in the East to California and Nevada in the West. (Michigan and Rhode Island are the other two.)
Across all these fronts, only a few factors appeared to provide even partial shelter from the storm. On many measures, as noted above, the energy-rich states of Texas, North Dakota, Oklahoma, and Alaska performed somewhat better than other states. Likewise, the 10 states with the highest proportion of college graduates suffered proportionally smaller losses in income and jobs than the other 40. But even that defense wasn’t impregnable: The states ranked 11 through 20 in college graduates experienced even greater income and job losses than those below them on the educational ladder.
Although states found no firewall against the downturn, the greatest source of vulnerability appears to have been real estate. According to the Federal Housing Finance Agency’s quarterly home-price index, from the fourth quarter of 2008 through the second quarter of 2011, housing prices fell in every state except Oklahoma and North Dakota. (Texas managed to hold its decline to less than 1 percent.)
The states where housing values fell the most also tended to fare the worst on the other key measures—income and employment. Of the 25 states in which housing prices declined most sharply, 20 also rank among the top 25 in job losses. Eighteen of those 25 housing-crash states are among the 25 biggest losers in median income. Likewise, 18 are among the 25 states that experienced the largest increase in poverty. “To me, the original sin remains the housing crash and the huge depression of demand” that it created, Muro said. “No matter what else you were doing, if you were too heavy into the real-estate crash, it is absolutely lethal.”
The housing crash pulverized states—such as Arizona, Nevada, Florida, and California—that had developed economies where, as the saying went, construction workers were building houses for other construction workers. But the ripple effects also cascaded into states where the housing markets had not overheated so badly.
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