‘Deadly Cocktail’: Here’s Why Some Blue States Are Still Reeling From Job Losses Four Years After The Pandemic

by Will Kessler, Daily Caller News Foundation, May 25, 2024

Several blue states are still reeling from job losses sustained during the COVID-19 pandemic, with economists pointing to the after effects of harsh lockdown policies as a key reason.

New York, Massachusetts, Vermont, Maryland, Hawaii and the District of Columbia have still not fully recovered from job losses taken at the onset of the COVID-19 pandemic, starting in February 2020. While each state and D.C. have their own specific circumstances leading to their economic malaise, their slow growth and recovery are partly attributable to the oppressive COVID-19 pandemic restrictions that they imposed on top of already restrictive economic atmospheres, according to economists who spoke to the Daily Caller News Foundation. 

“The states that ignored the medical data on COVID-19 and locked down particularly hard and long were almost exclusively Democrat-run states,” E.J. Antoni, a research fellow at the Heritage Foundation’s Grover M. Hermann Center for the Federal Budget, told the DCNF. “They took the longest to recover economically, and some still haven’t because the damage done was so extensive.”

Washington, D.C., suffered the biggest job losses, declining from 801,900 total jobs in the district in February 2020 to 767,400 as of April. There are still around 27,800 fewer jobs in Hawaii than before the COVID-19 pandemic, declining from 663,800 to 636,000 in that same time frame.

New York has nearly recovered the jobs lost during the COVID-19 pandemic, short just 6,200 from February 2020 to April 2024. Massachusetts is still below pre-pandemic levels by 13,100 in that same time frame.

The total number of jobs in Maryland is 2,752,000 as of April, slightly lower than the 2,783,000 jobs in the state in February 2020. Vermont is also slightly below the 315,800 jobs it had at the start of the COVID-19 pandemic, sitting at 314,700 as of April.

In contrast, there are nearly 6 million more jobs in the U.S. economy as of April than there were in February 2020, despite an initial decline of almost 22 million at the onset of the pandemic. The four states with the greatest relative job growth since February 2020 were Idaho, Utah, Florida and Texas, all states run primarily by Republicans who did not place significant restrictions or removed them very quickly during the COVID-19 pandemic.

“U.S. states that put in place more stringent lockdown and non-pharmaceutical measures have seen slower recoveries,” Peter Earle, economist at the American Institute for Economic Research, told the DCNF. “Within those states, officials and their supporters will say that they are recovering from a pandemic, which is untrue. They are in fact recovering from the policies they enacted to attempt to combat the spread of the virus.”

The number of businesses in just Manhattan declined by more than 5,200 from the fourth quarter of 2019 to the fourth quarter of 2021, according to New York City’s comptroller. New York City maintained many COVID-19 restrictions long after other states had dropped theirs, including not reopening indoor dining to 25% of its pre-pandemic capacity until February 2021 and not permitting movie theaters to open until March 2021.

“These also tend to be states with high taxes and burdensome overregulation,” Antoni told the DCNF. “This has proved to be a deadly cocktail for economic growth. To be clear, there was already a growth rate disparity between red and blue states before COVID, but the public policy decisions since 2020 have exacerbated that difference. Furthermore, government-imposed lockdowns also kept the blue states in economic stasis while the red states grew, broadly speaking.”

Republican Gov. Charlie Baker of Massachusetts was in office during the onset of the COVID-19 pandemic in 2020, initiating a phased reopening in May that was then halted in August, according to NBC Boston. Many restrictions were then reimposed in November after a spike in COVID cases, leading the state to not move to the fourth phase of its reopening plan until March 2021, which allowed large indoor and outdoor venues to resume service.

Maryland similarly began lifting initial restrictions in the summer of 2020, only to reimpose them in November amid a spike of cases, not lifting capacity restrictions until May 2021, according to Capital New Service Maryland. D.C. lifted its capacity limits in May 2021 as well but kept its broader mask mandate in place until later in the year.

Hawaii was hit particularly hard by its COVID-19 restrictions due to the effects that they had on the state’s robust tourism industry, according to USA Today. Hawaii did not lift its mandatory five-day quarantine when entering the state without vaccine proof or a COVID test until March 2022.

Vermont waited until 80% of the state’s eligible population had received at least one dose of the vaccine to end the state’s COVID-19 state of emergency, which did not occur until June 2021. The state of emergency imposed varying restrictions on social gatherings and business operations.

“I presume that there are so many people moving out of blue states and red states that just that population shift is going to explain a lot of the job numbers,” Michael Faulkender, chief economist at the America First Policy Institute, told the DCNF. “If you have fewer adults in your state because they’ve moved to a more liberty-friendly state, then you’re just going to have fewer workers in your state.”

New York’s population declined by over 530,000 from 2020 to 2023, leading the state’s governor, Kathy Hochul, to warn in the middle of 2023 that the state could see budget shortfalls in fiscal year 2025 due to a potential decline in tax receipts, according to City and State New York.

Massachusetts’ population declined by nearly 32,000 between April 2020 and July 2023, to just over 7 million residents. The state’s GDP grew just 1.8% in 2023, rising 2.1% from the year before.

Hawaii’s population also shrank from April 2020 to July 2023, down more than 20,100 residents, according to the Census Bureau. The state’s GDP has still not recovered from the more than 10% decline taken in 2020.

The GDP of the country as a whole grew by 2.5% in 2023 and by 1.9% in 2022.

D.C.’s population declined from 689,548 in April 2020 down to 678,972 as of July 2023, according to the Census Bureau. The district’s economy grew just 1% in 2023 and 0.9% in 2022.

Louisiana was the only red state that has yet to fully recover all the jobs it lost during the COVID-19 pandemic, down 27,100. The state lost nearly 80,000 residents between 2020 and 2023.

While the states’ economies did suffer, some did manage to suppress their total COVID-19 deaths compared to other states, according to the Centers for Disease Control and Prevention (CDC). Vermont had just 16 deaths per 100,000 people in 2020, and Hawaii had just 16.8.

Other states were less successful in mitigating deaths, with New York having the second highest deaths per 100,000 in 2024 at 139.1 and Massachusetts having 100.2, according to the CDC. Maryland was around the median for states, with 80.9 deaths per 100,000 people.

“Lockdowns and stay-at-home orders were probably the most damaging policy measures put in place,” Earle told the DCNF. “They forced firms to shut down for prolonged periods, throwing millions of Americans out of work overnight. Worse yet, they had a disproportionately brutal impact on small businesses, which are the cauldron of job creation and economic growth in the United States. A future James Bond supervillain won’t use space lasers or weather control to wreck the US economy — they’ll just cite some biological threat and put indefinite lockdowns in place.”

The governor’s offices of New York, Massachusetts, Vermont, Maryland and Hawaii and the D.C. mayor’s office did not respond to a request to comment from the DCNF.