Why It Matters<\/p>\n
While fears over an imminent recession<\/a> have somewhat abated thanks to stronger-than-anticipated gross domestic product (GDP<\/a>) growth in the second quarter of 2025, economists and consumers remain concerned that the economy is fragile and that tariffs<\/a>, inflation and a weakened labor market could continue to weigh on the country\u2019s economic outlook.<\/p>\n Anderson\u2019s comments follow an analysis from Mark Zandi, chief economist at Moody\u2019s Analytics, who in August found that 21 states and Washington, D.C. were currently in, or at high risk, of a recession<\/a>. Zandi told Newsweek that the list was “a subjective assessment based on various coincident measures of economic activity,” including payroll employment<\/a> and industrial production.<\/p>\n In his analysis, Zandi said that California and New York were \u201cholding their own\u201d and \u201ctreading water,\u201d but told Newsweek in a subsequent interview that the fate of the these states, given their economic might, \u201cmay decide what happens to the nation<\/a>.\u201d<\/p>\n \u201cI mean, if California and New York weaken and start to contract, the national economy is going to go into recession,\u201d he said. \u201cAnd if those economies hold their own or start to accelerate or reaccelerate, the economy is going to be fine and get through without recession.\u201d<\/p>\n Zandi echoed this statement in a recent interview with Fortune<\/a>, and said that the two economies\u2019 own trajectories could depend on the continued success of Wall Street as well as California\u2019s tech sector.<\/p>\n Almost every state saw its GDP rise in the second quarter of 2025, according to the Bureau of Economic Analysis<\/a> (BEA), including California and New York. While the conventional definition of a recession is two quarters of GDP contraction, Zandi told Newsweek that his definition is closer to that employed by the National Bureau of Economic Research as \u201ca broad-based persistent decline in economic activity\u201d marked by, among other things, weakening job growth.<\/p>\n While official data on job growth has been delayed<\/a> due to the ongoing government shutdown, Zandi said his analysis of private data sources pointed to another weak period for the labor market<\/a>, and told Newsweek that a loss of 4,000 jobs<\/a> during September appeared \u201cplausible.\u201d<\/p>\n What People Are Saying<\/p>\n Mark Zandi told Newsweek this week: \u201cThe job market is sputtering, as job growth has come to a standstill. Abstracting from the vagaries of the monthly data, monthly job growth is close to zero, give or take.\u201d<\/p>\n \u201cHigher tariffs and highly restrictive immigration policies are weighing on the job market. These policies create uncertainty for businesses, weaken labor demand, and limit labor supply, all of which have caused businesses to curtail their hiring,\u201d he added. \u201cFortunately, businesses have not turned to layoffs, as low layoffs is the firewall between a weak economy and a recession.\u201d<\/p>\n What Happens Next<\/p>\n The BEA is scheduled to release its first estimates for GDP growth in the third quarter later this month, after determining that the economy grew by 3.8 percent for the second quarter, and TradingEconomics projects 1 percent growth at an annual rate.<\/p>\n","protected":false},"excerpt":{"rendered":"Economists are warning that the fate of California and New York\u2019s economy could determine whether the entire country…\n","protected":false},"author":2,"featured_media":220479,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[36],"tags":[28,101,4084,1556,134,14443,759],"class_list":["post-220478","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-business","tag-economy","tag-employment","tag-gdp","tag-jobs","tag-recession","tag-tariffs"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/220478","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=220478"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/220478\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/220479"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=220478"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=220478"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=220478"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"\"](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2025\/10\/AP25274509800241.jpg\"\/)
What To Know<\/p>\n