How has the COVID-19 pandemic affected state budgets? Using a quarterly panel of states between 1994 and 2019, we estimate how changes in employment affect tax revenues. We find that a one percentage point (pp) rise in employment is associated with a 1.56pp rise in total tax revenue, which is concentrated among sales taxes (a 1.19pp increase), individual income taxes (a 1.63pp increase), and corporate income taxes (a 4.13pp increase). These results are robust to a wide array of controls, such as state composition and housing price growth, and to instrumental variable specifications. After estimating state-specific elasticities and forecasting counterfactual employment within states using the most recent data, we find that the average state will experience a 6.7% decline in its tax revenues under an optimistic scenario, culminating in $79.9 billion lost in total aggregate revenue for the United States, or a 11.1% decline under a pessimistic scenario, culminating in $125.2 billion lost in total.