Pew Releases New Report on the Fiscal Health of States
“More than four years after the Great Recession officially ended in June 2009, states’ financial conditions are improving, but most have yet to get back to where they were on some key measures of fiscal health.” That’s the headline from a report just completed by the Pew Charitable Trust. Fiscal 50: State Trends and Analysis examined data from all 50 states and its analysis determined that state governments still face additional difficulties that could set them back even as the economy picks up.
The fiscal health of state governments is important to the interests of chambers of commerce for many reasons. As states continue to struggle to fund critical services such as health care for the needy, basic education, transportation and public safety, they are not able to invest in more long-term strategies, and there is additional pressure to find new sources of revenue.
Further, state finances matter because of their impact on the U.S. economy. State spending accounts for 4 percent of the nation’s economic output, and states provide about one-third of local governments’ budgets.
While the report finds that some measures are moving in the right direction, unavoidable pressures loom and could slow further recovery. One hurdle is the burden of unfunded pension and retiree health care costs for public workers. Another challenge is the prospect of more federal budget cuts—coming after a period in which federal dollars made up a bigger share of overall state revenue than at any time in at least 50 years.
Pew’s Fiscal 50 identifies five core areas that contribute to states’ fiscal health: Revenue, Spending, Economy and People, Long-term Costs, and Fiscal Policy. Within this framework, Pew highlights trends, makes 50-state comparisons, and provides unique insights into significant fiscal, economic, and demographic indicators that influence state finances.
For most indicators, Fiscal 50 allows users to compare their state to others and to a national benchmark, providing insights and perhaps raising questions in state capitals about why states lead or lag behind their peers. This resource will be updated when new data are available, and additional indicators and further analysis will be added.
Click here to access the full interactive report. For questions or more information, contact Sarah Leiseca, email@example.com, 202.540.6369.