State Economic Watch

Concerns are being expressed by political leaders and others in Utah and Idaho about the lack of skilled workers to meet the demands of a revived US nuclear power industry. The US Department of Energy has reportedly estimated that a proposed 400 gigawatt increase in nuclear power capacity by 2050 would require a tripling of the existing nuclear industry workforce. Both states are looking at ways to tailor workforce training to accommodate this expansion.

  A new report from the University of Massachusetts, Amherst Donahue Institute’’s Economic and Public Policy Research Group takes a deep dive into the economic profile of the state’s research and development industry. The report, The Research and Development Ecosystem: Engine of the Massachusetts Economy , identifies a direct and indirect contribution of $218 billion to the state’s economy from R&D activities, equivalent to 28% of Massachusetts GDP. It warns that federal research cutbacks and restrictive visa policies threaten to impact the state’s economy for a decade. 

  The latest Tri-State Tracking reports from the Federal Reserve Bank of Philadelphia starkly illustrate a now familiar employment theme. The Philly Fed notes that through January 2025, y/y employment growth in Delaware, New Jersey, and Pennsylvania has been driven almost entirely by the health and education services sector. In all three states, the payroll gains from this category dwarf all other sectors by a wide margin. While both Delaware and Pennsylvania saw some modest gains from a handful of other payroll sectors, New Jersey experienced y/y employment  declines in every category except health-education and business services.   

  Non-current mortgages ticked up nationally in February from 4.1% to 4.2% with both early-stage delinquencies and mortgages 90+ days delinquent inching higher, according to the most recent ICE Mortgage Monitor . Delinquency and foreclosure rates were little changed in most states in February, with the highest delinquency rates still being posted primarily by the southern states. The five states with the highest non-current rates remain Louisiana (8.6%), Mississippi (8.5%), Alabama (6.4%), Arkansas (6.1%), and Indiana (6.0%). Idaho, Washington, Montana, Hawaii, and Colorado had the lowest non-current rates, all 2.4% or less. The states seeing the greatest y/y increase in non-current rates were Utah (+19%), Arizona (+15%), Maryland (+14.4%), and Nevada (+12.2%). We note that Utah, Arizona, and Nevada all saw modest increases in early-stage delinquencies in February. Hawaii was the only state to post a y/y decline in its non-current rate.

  In its new combined format, the US Bureau of Economic Analysis reported 4Q2025 GDP and personal income statistics for the US together with those of the states earlier today. This blog reported on the state GDP statistics in a previous post. According to the BEA, personal income increased at a 3.4% annualized rate in the quarter in the US, increasing in 47 states and declining in three. Hawaii posted an outsized growth rate of 41.5%, but the BEA reports that this was principally due to payment of a claims settlement related to the 2023 Maui wildfire. Apart from Hawaii, North Carolina and Louisiana both posted personal income growth of over 5%, but in each case, the growth was broad based and wasn’t driven by any individual personal income component. Iowa, South Dakota and North Dakota saw personal income declines of 1.5%, 2.0% and 4.0%, respectively, with all three negatively impacted by declines in farm income. The below exhibit is from this morning’s BEA press release.

This morning, the US Bureau of Economic Analysis reported that real GDP increased in 35 states in 4Q2025, but declined in 13 states and the District of Columbia. The biggest gains were seen in the Dakotas, with North Dakota posting an annualized growth rate of 3.8% and South Dakota 3.0%. Minnesota had the third highest growth rate at 2.2%. Economic growth in the Dakotas was principally driven by strong gains in the Agriculture, Forestry, Fishing and Hunting category. In North Dakota’s case, the 4Q growth in that sector of +3.42% represented a substantial snapback from the -2.76 reported in 3Q. DC, Maryland and Virginia led the way on the downside with real GDP declines of 8.3%, 3.3% and 1.8%, respectively, and in each case, a sharp decline in the Federal Civilian category was the principal reason. The below exhibit is from this morning’s BEA press release.