These 3 States (and D.C.) Could Face Massive Job Losses If the Debt Ceiling Crisis Isn’t Resolved

Dramatic view of the United States Capitol Building in Washington DC.

Mikhail Makarov/istockphoto

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Dramatic view of the United States Capitol Building in Washington DC.
Mikhail Makarov/istockphoto

Debt Disaster

Surprise, surprise: Congress has yet to resolve its debt ceiling crisis, which means that the United States could run out of money as early as June. That spells disaster for everyone — a default could tank the economy — but especially for states dominated by government-funded jobs and federal workers, according to a recent report from Moody’s Analytics. The report argues that a default would “most immediately” impact the following regions because of the concentration of federal workers.

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Washington DC United States Capitol and Pennsylvania Avenue

Washington, D.C.

It shouldn’t be a surprise that the nation's capital will feel the brunt of the economic pain, with the federal government accounting for around one in four jobs. In a prolonged debt limit scenario, the city would peak at an 8.9% unemployment rate. Moody’s Analytics calls the district the “most immediately vulnerable economy.”

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Downtown Anchorage, Alaska in winter


In states like Alaska, which rely on federal jobs to bolster the economy, a breach could accelerate the region’s economic fallout. The state could lose 6,900 jobs in the near term, reaching a peak unemployment rate of 7% if the political impasse lasts until the summer.

Related: 15 Jobs That Are Most Vulnerable to a Recession

Cityscape of Waikiki, Honolulu, Oahu Island, Hawaii


Hawaii is in a particularly vulnerable position, and not only because Moody’s predicts that the state will lose 9,200 jobs in a prolonged debt crisis scenario. Beyond having many military and federal workers, the archipelago has a heavy tourist industry, which would be particularly susceptible to a debt crisis. A drawn-out debt crisis would leave the state with a peak 4.5% unemployment rate.

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Albuquerque Skyline With Neighborhoods And Mountains