State Economic Watch

Here’s an interesting graphic to contemplate while you’re waiting for the ball to drop. It's from the US Census Bureau’s Business Trends and Outlook Survey . The Survey covers a wide range of topics related to current and forecast business conditions. The data is released biweekly and the most recent data set was released today.  The exhibit below reflects state-by-state responses to the question “In the last two weeks, did this business use Artificial Intelligence (AI) in any of its business functions? (Examples of AI: machine learning, natural language processing, virtual agents, voice recognition, etc.)”. The range of responses was fairly wide. Businesses in Mississippi and Arkansas reported the smallest AI uptake, while those in Rhode Island and Arizona the largest. Of course it’s early days yet, and the response rates are likely driven, in large measure, by the industries that are clustered or concentrated in each state, but nevertheless, it is interesting to see where AI is b...

In one of the last remaining monthly state JOLTS reports to be released, the BLS today reported little change in the Job Openings and Labor Turnover data for October 2025. Job opening rates were unchanged in the vast majority of the states, but were up between two and four percentage points in Alaska, Montana, and Wyoming. Similarly, layoff rates increased in South Carolina, New Mexico, and New Jersey, but decreased in Colorado, Iowa, and Connecticut. However, in all of these cases, the change in the layoff rate was less than one percent. The below graphic illustrates the range of layoff and discharge rates nationally in October.

Once again, we see the monthly House Price Indices from the Federal Housing Finance Agency (FHFA) confirming the data from the S&P Cotality Case-Shiller release. Similar to this morning’s Case-Shiller announcement, the FHFA reports that while its national House Price Index (SA) increased 1.7% m/m in October 2025, the regional differences were striking. According to the FHFA data, house prices were down y/y in the West South Central and South Atlantic regions, flat in the Pacific and Mountain regions, and notably higher in the Middle Atlantic, East North Central, West North Central, and New England regions. The East South Central region posted a modest y/y gain in house prices. We will get more granular data from the FHFA when it releases the quarterly state indices in February, but the broader monthly figures continue to indicate a rotation out of some of the once high-flying sun belt markets and into the Upper Midwestern and Northeastern markets.  

The October 2025 S&P Cotality Case-Shiller Indices reflect a continually slowing housing market, as the National Composite Index (NSA) increased only 1.4% y/y, the weakest since mid-2023 according to today’s press release. The slowdown is being acutely experienced in sun belt cities, like Tampa, Phoenix, and Dallas, which saw y/y declines of greater than 1%. Conversely, some of the largest y/y gains were posted by snow belt cities like Chicago, Cleveland, and New York. On a m/m basis, most of the cities in the 20-City Composite Index posted losses, with only three managing to eke out minimal increases. The National Composite Index value hit its most recent peak in July 2025 and has been declining since then. 

The results of the most recent Federal Reserve Bank of New York Business Leaders Survey indicates that the service sector in the New York-Northern New Jersey region continued to slump in December. The top line business activity index remained in negative territory as did the business climate Index. The activity index has been below zero since October 2024, but the current December reading of -20 is slightly better than the prior month’s -21.7. The climate index on the other hand, hasn’t been in positive territory since August 2021, and the December 2025 reading of -44.2 is the worst since June 2025. The employment index has been negative for four consecutive months, but December’s -7.4 was a tick better than November’s -8.6. Finally, the capital spending index was negative for the third consecutive month at -6.9.  The six-month forward indexes told a slightly better story. The forward employment index held to a minimally positive at +3.8. While the forward business activity and cl...

North Dakota’s oil production has remained stable even as recent oil prices have hovered around the break even level, according to the state’s Department of Mineral Resources . The Department’s Director, Nathan Anderson, attributes this to new drilling technology being utilized by producers in the state which allows them to drill horizontally for three to four miles rather than the standard two. According to Anderson, this improves the drilling economics by shortening the payback period, among other things. As a result, even with the US EIA projecting WTI prices in the low $50s for 2026, North Dakota oil production is expected to remain firm.

Terrific article in today’s New York Times about one of this blog’s favorite topics - the tourism economy. Not only has most international tourism failed to recover, but some travel industry experts are also beginning to quietly question whether the World Cup will actually generate the amount of international tourist traffic and spending that has been projected. Good read for a holiday weekend.