The 8 Most Economically Distressed States

On paper, the recession ended back in 2009. Of course, anyone who runs a practice or owns a small business will tell you the economic struggle has continued.

Still, unemployment is down, the market has recovered, and economic optimism has returned. For most of us, that is. The Economic Innovation Group (EIG), a Washington DC-based think tank that says its mission is to address the nation’s economic challenges, has released a new study that aims to pinpoint the areas where the economy continues to lag.

The EIG’s Distressed Community Index uses 7 metrics, to measure economic distress. Those metrics are: Educational Attainment, Housing Vacancy Rate, Unemployment Rate, Poverty Level, Median Income Ratio, Change in Employment (the percent change in the number of people employed), and Change in Business Establishments (the percent change in the number of businesses.

EIG ran those numbers for every zip code in the country. On a city level, Detroit was found to be the most-distressed large city in the US, with 94% of the city’s population living in zip codes identified as in distress. Detroit was followed by Memphis, Milwaukee, Atlanta, and Baltimore.

EIG also compiled their statistics to create state-based rankings. Wyoming came out on top, followed by North Dakota, Vermont, Iowa, and Idaho. In general, EIG found so-called “Blue States” — those that tend to vote for Democratic political candidates – were more likely to be economically distressed. However, GOP-favoring Red States were found to have the most economic inequality.

What follows are the 8 states found to be most in economic distress. Each of these states has at least 20% of its population living in distressed neighborhoods. Also listed are each state’s unemployment rate as of May 2015. By comparison, the national unemployment rate in May was 5.5%

Percentage of Population Living in Distressed Areas: 20%

May 2015 Unemployment Rate: 5.7%

Percentage of Population Living in Distressed Areas: 21%

May 2015 Unemployment Rate: 6.2%

Percentage of Population Living in Distressed Areas: 22%

May 2015 Unemployment Rate: 5.8%

Percentage of Population Living in Distressed Areas: 23%

May 2015 Unemployment Rate: 6.1%

Percentage of Population Living in Distressed Areas: 25%

May 2015 Unemployment Rate: 6.7%

Percentage of Population Living in Distressed Areas: 25%

May 2015 Unemployment Rate: 6.8%

Percentage of Population Living in Distressed Areas: 25%

May 2015 Unemployment Rate: 6.3%

Percentage of Population Living in Distressed Areas: 33%

May 2015 Unemployment Rate: 7.0%