The U.S. economy reported its worst quarterly decline in modern history during the COVID-19 pandemic, with gross domestic product shrinking at an annual rate of 31.4 percent in the second quarter. The economy bounced back in the third quarter, but efforts to contain the virus’s spread throughout 2020 still resulted in a 3.5 percent annual economic contraction in the United States.
Arriving on the heels of a historic period of growth, COVID-19 brought about a decline in gross domestic product in every state in the country. However, no two state economies are alike, and partially as a result, some states were hit far harder than others.
Iowa is one of only eight states to report an economic contraction of less than 2.5 percent in 2020. Iowa’s 2020 GDP of $169.5 billion was 2.3 percent lower than it was in 2019. Efforts to contain the spread of the coronavirus slowed economic activity in the state. Two of the industries that detracted the most from growth were transportation and arts, entertainment, recreation, accommodation, and food services.
Just as economic decline was not as steep in Iowa as in much of the rest of the country, neither were job losses. Employment fell by 5.1 percent in the state in the last year, below the 5.8 percent national decline.
States are ranked based on the percentage change in real GDP from 2019 to 2020. Data on GDP and industry-specific real GDP came from the BEA. Data on average annual employment and the seasonally adjusted monthly unemployment rate each came from the Bureau of Labor Statistics.