Some States are Predicted to Emerge From Recession by End of the Year


An article on www.msnbc.com reveals predictions for which states will emerge from the recession first.  The analysis predicts Colorado, Idaho, Oregon, Texas and Washington will be the first out of the gate, starting in the last quarter of this year.  This will be followed by Alabama, Georgia, Nebraska, New Mexico, North Carolina, North Dakota and South Dakota in the first quarter of 2010.

The forecast is developed by Moody’s Economy.com, where a new prediction is released monthly along with its “adversity index.”  The theory goes that since all states did not enter the recession at the same time, they will also not exit at the same time.  The analysis is based on “employment, industrial production, housing starts and house prices to label each state or metro area as expanding, at risk of recession, in recession or recovering,” according to the article.

The article further states the recession officially entered 373 of the nation’s 381 metro areas in March, and has now affected 49 of the 50 states (Alaska being the exception).

IMPLICATIONS

While overly-simplistic to just pick the recovering states to target as a government vendor, there is some validity in overlaying this information with state stimulus plans and existing strategic company strongholds (e.g. strong distribution or sales coverage ).  Targeting a strategically advantageous state that has funding for well-aligned projects while emerging from the recession could prove fruitful to vendors. 

In addition, just as certain states will pull out of recession earlier than others, so will certain sectors and industries.  With stimulus money beginning to flow to government agencies, firms active in the space should see themselves bounce back more quickly–at least let’s hope so.

-LBB

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