Not necessarily. The guidance is to split your TF code across multiple states which might feel like it make sense but for your microservices to communicate that beed to share some base infrastructure, such as networking, so where does that live? Putting dependencies in their own state means that you lose the ability to understand how changing them impacts all of your infrastructure because you have this information black hole at the boundary of their state.

With Stategraph, you'll get all the benefits and isolation of separate state files, but when you changed resources, you'll get meaningful plans around all of the infrastructure they impact, not just the statically defined boundaries of a state file.

Author here. You are right that splitting by microservice reduces overlap. The problem is shared resources never go away such as VPCs IAM or databases so contention shows up there.

Splitting state files is the common workaround but that only creates new problems like cross state dependencies and orchestration glue. The real issue is the storage model which is a single JSON blob with a global lock. Treating state as a graph with proper concurrency control avoids contention while keeping a cohesive view of infrastructure.

It is the usual DRY/WET concern. Having microservices be completely independent and relying only on shared message broker or service discovery has its benefits, but the cost is generally duplication of things. Things like "whitelist this inbound IP for all services" or "configure telemetry endpoint" often end up in making N changes to N separate repos, and it becomes hell if you have to talk to N teams.