September DIVER Geo Scores Released; Bad News Continues for VA, MD and NJ

Categories: Commentary, Uncategorized |

October 6, 2014

Lumesis released the updated DIVER Geo Scores last week.  The DIVER Geo Score represents a relative score of the economic health of a U.S. State, county or city. Based on a scale of 0-10, with 10 being the best, this data is updated monthly and is calculated from multiple economic and demographic factors related to three primary data categories—employment, income and housing.  We survey the strongest, weakest, and top movers, including a brief discussion of the top State to watch, New Jersey.

State Geo Scores:  Virginia, Maryland and New Jersey Remain States to Watch.

The September 2014 DIVER Geo Scores show some slight changes in the Strongest and Weakest 10 rankings vs. August 2014.

State DIVER Geo Score Strongest and Weakest

(September ‘14)


DIVER Data Solutions

Most notable within the Ten Strongest are shifts down for Virginia and Massachusetts.  We are more concerned about the Virginia move than Massachusetts.   Since May 2013, Virginia’s relative economic strength has been slipping:  it has moved from being the 5th best state economy to the 10th.  County level Geo Scores show the Virginia weakness concentrated in Stafford, Fauquier, King George and Prince William (I-95 Express investors take note). Despite the 1-month blip, the trend for the Massachusetts economy remains positive.

North Carolina and West Virginia both shifted into the Ten Weakest this month.   North Carolina’s relative strength had improved steadily from January 2012 to November 2013, but has been deteriorating steadily since.  West Virginia has long been among the weakest States economically.  The most recent employment data shows a sharp deterioration relative to national averages.  This is likely due to pressure on the coal sector combined with a slight improvement in West Virginia’s historically low rate of labor force participation.

Like its neighbor Virginia, Maryland continues to show a decline in its relative economic strength.  For Maryland, counties Charles, Prince George, Calvert and Carroll are all showing relative weakness.

Biggest State DIVER Geo Score Movers

(September ’13 to September ‘14)

10-6 2

Source: DIVER Analytics-Data Access Module, DIVER Data Solutions

The States with the most improvement showed strength across the spectrum of our metrics:  Hawaii and Colorado (employment); Ohio, Arizona, and Indiana (employment and housing); Washington (employment, housing, and income).

New Jersey:  Well-Publicized Challenges and Still Large Risk of Downside Surprise  

Despite weaknesses that are well publicized, New Jersey is arguably the large municipal credit with the most risk of a downside surprise (either in ratings or spreads or both).  A lagging economy, growing pension issues, the rapid acceleration in the decline of Atlantic City, and a Governor who has been distracted by both a local scandal and national political events all pose continuing risks to New Jersey’s economic and fiscal well being.

The most recent Geo Scores for New Jersey and its counties highlight the lagging economy and point to economic spillover effects from Atlantic City’s difficulties.  In particular, New Jersey has showed weak housing market performance.  New Jersey recently experienced an uptick in foreclosure activity, which press reports attribute to several factors:  including ending of various moratoriums, but more importantly the impact on southern Jersey residents of the weakness in Atlantic City.

Below is an update to a chart we published several months ago which displays the steady decline in New Jersey’s Geo Score ranking, along with the average Geo Scores for North and South Jersey counties.

New Jersey DIVER Geo Scores

(3 month moving average)

10-6 3

Source: DIVER Analytics-Data Access Module, DIVER Data Solutions

This week the Lumesis team will be in California for the Bond Buyer Public Finance Conference.

Have a great week,


Mike Craft
Managing Director, Credit, Lumesis, Inc.


CLICK HERE to Subscribe to the Weekly Commentary