Every part of the country will feel the economic fallout from the coronavirus crisis. But the small and isolated rural areas that lagged during the economic boom may fare better, relatively speaking, in the aftermath of the pandemic.
Those places tend to be less tied to global and financial markets. With little population density, they are less conducive to virus transmission. So far, states such as Wyoming, the Dakotas, Nebraska and Iowa have reported far fewer COVID-19 cases than New York and other states with large cities.
“If you are a somewhat more isolated economy that does not attract as much visitation from either outside the U.S. or even domestically, you are less vulnerable,” said Adam Kamins, an economist and director at Moody’s Analytics, in a webinar last month.
The states least affected by the huge spike in unemployment claims are largely rural. They include West Virginia, Arkansas and Georgia. In part, that’s because those states have taken less dramatic steps to slow the spread of the virus. Among them, only West Virginia issued a stay-at-home order before the end of March.
Nevertheless, “the industries that have been hard hit are just not as prevalent in rural areas,” said Ernie Goss, an economics professor at Creighton University in Omaha, Nebraska. He cited the relative lack of retail and hospitality businesses in Corn Belt states.
Economists rank regions as economically vulnerable to coronavirus fallout based on demographic and economic factors, including their number of COVID-19 cases, connection to international travelers, reliance on tourism, population density and reliance on global trade, according to a Moody’s Analytics analysis.