Executive Summary Prior to the pandemic, the concern was a possible economic downturn that states were preparing to feel in the next few years. Now, the instant magnitude of COVID-19 shock only amplifies existing budget problems, such as insufficient funding for core programs, and creates new challenges. Through the analysis contained in this white paper, we aim to: –– Help states understand the continuing economic risk associated with managing the COVID-19 pandemic through the examination of fiscal shortfalls, unemployment payments, and increased expenditures –– Analyze resiliency factors that can help states better prepare to weather this and future shocks
Understanding Fiscal Risk and Resiliency Initial estimates by KPMG’s Chief Economist, Constance Hunter, state that U.S. growth may take until after 2024 to reach 2019 levels.7 Understanding fiscal strengths to help a state recover from the COVID-19 pandemic and the economic vulnerabilities that may be compounded through ongoing pandemic impacts can provide options for states to develop strategies toward recovery and improved resiliency. Through a variety of scoring factors further detailed in this white paper, we summarize each state’s fiscal strengths and economic vulnerabilities in the Fiscal Risk versus Fiscal Resiliency analysis shown below.
–– Explore strategies to recover and manage the unique challenges from this pandemic. Exhibit 2: State-by-State Analysis of Fiscal Risk versus Fiscal Resiliency
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KPMG LLP Economics, “V-U-L-nerability: How will we emerge from the Great Lockdown?” June 3, 2020. https://www.kpmg.us/content/dam/global/pdfs/2020/CoronaVirus_MiniChartBook_update.pdf
July, 2020 | A Report by The Council of State Governments
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