States are managing through a slow and uneven economic recovery and many have not yet returned to pre-recession revenue levels. Rising health care, education, and infrastructure costs are placing pressures on annual budgets. The ways in which policymakers confront these challenges will affect states and the nation for years to come. Pew's work on states' fiscal health provides data, analysis, and guidance to help states navigate their fiscal challenges and identify and understand potential policy approaches. We examine key trends in state economies and budgets, and research and advance promising approaches to managing volatile state finances in an era of heightened uncertainty.
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States have made halting progress in rebuilding their financial cushions since the Great Recession. Overall, states had enough money in general fund budget reserves in fiscal year 2007—just before the economic downturn—to run government operations for a median of 41.3 days. That compares with 25.9 days in fiscal 2014 and early estimates of 20.5 days in fiscal 2015. Read More
The U.S. employment rate for adults of prime working age has been rising for four years, and the number of states with lower employment rates than before the Great Recession has been shrinking. Despite these signs of improvement, however, the labor market had not completely recovered from the economic downturn by mid-2015. Read More