Economist Dr. Anirban Basu analyzes Delaware’s 2025 economic status

NEW CASTLE- In a recent economic forecast, Dr. Anirban Basu, Chairman and CEO of Sage Policy Group, Inc., provided insights into Delaware’s economic landscape and projection. 

Dr. Basu’s outlook for Delaware remains positive. He highlighted that the state’s unemployment rate is low, and its economy is well-diversified, positioning it well for resilience.

A “well-diversified” economy

According to Basu, Delaware has successfully developed a more diversified economy with key drivers spanning several industries. Those drivers include professional services such as accounting, architectural, and legal services.

Many professionals in Delaware also serve a broader market, including the Philadelphia metropolitan area.

Another major contributor to the state’s economy is the health services sector, fueled by an aging population and increasing demand for healthcare workers.

“Delaware’s population, like the rest of the country, is getting older, health utilization is up, and so there is more demand for caregiving personnel, health services workers,” Basu said.  

Delaware’s logistical industry has benefited from the Port of Wilmington and the strategic location of Interstate 95, supporting warehousing, distribution centers, and transportation jobs.

Construction has also played a pivotal role in the state’s economic expansion, with ongoing residential development in Sussex and Kent counties.

“The built environment is constantly changing in New Castle County, the Wilmington metropolitan area, and the state overall,” he said.  

He highlighted that the state’s population now exceeds one million and has been adding jobs at a rate comparable to the national average since the pandemic. 

“The state has added jobs at roughly the same pace as the balance of the country since the start of the pandemic, which is pretty impressive for a northeastern corridor community.”

Low unemployment has challenges

New Castle County’s unemployment rate currently sits at a low 3%, reflecting a strong labor market. Though the rate can be seen as a positive, Basu cautioned that such a low rate might also indicate a lack of housing opportunities, which can deter job seekers from moving to the area.

“When a community has such a low rate of unemployment, it might be evidence of a lack of housing opportunities.” 

Without sufficient affordable housing, younger families and potential workers may choose to settle in regions where housing costs are more manageable. This can pose a challenge for businesses looking to expand if they struggle to find the necessary workforce. He notes a similar pattern in other states, including his home state Maryland, where high housing costs have restricted labor force growth.

Despite Wilmington’s vibrant economy, the low unemployment rate could indicate that the labor force is not growing as rapidly as it could be.

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Economic outlook and recession concerns

When discussing the broader economic outlook, Basu initially did not anticipate a recession in 2025. However, he acknowledged that economic conditions have changed rapidly since his evaluation in February. 

“Predicting the economy is dangerous business.”

Financial markets have become volatile, and consumer sentiment has declined due to concerns about tariffs and other economic factors.

Concerns over tariffs on steel, aluminum, vehicles, and pharmaceuticals, along with weak corporate outlooks from airlines and department stores like Kohl’s, suggest that the economy is slowing.

While Basu says that a recession remains unlikely, he did note that “recession is more probable now than it was a month ago.”