The Best and Worst Run States in America: A Survey of All 50

December 3, 2014 by 247alex

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Source: Thinkstcok
How well run is your state? Assessing a state’s management quality is hardly easy. The current economic climate and standard of living in any given state are not only the results of policy choices and developments that occurred in the last few years, but can also be affected by decisions made decades ago, and by forces outside a state’s control.

Each year, 24/7 Wall St. attempts to answer this question by surveying various aspects of each state. To determine how well states are managed, we examine key financial ratios, as well as social and economic outcomes. This year, North Dakota is the best-run state in the country for the third consecutive year, while Illinois replaced California as the worst-run state.

Read: The Best and Worst Run States in America

Selecting appropriate criteria to compare the 50 states is difficult because there is so much variation among the states. As a result, policy decisions that may work in one state might not work in another. Some states are rich in natural resources, while others rely on high-skilled sectors such as technology and business services. Some depend disproportionately on one industry, while others’ economies are more balanced. Further, some states are more rural, while others are highly urbanized and densely populated.

This year, a number of the best-run states again benefit from an abundance of natural resources. North Dakota, Wyoming, Alaska, and Texas are among the top 10 best-run states, and in all four, the mining industry — which includes fossil fuel extraction — is a major contributor to state GDP. Due in large part to the mining sector, North Dakota and Wyoming led the nation in real GDP growth in 2013. And Alaska has utilized its oil wealth to build massive state reserves and to pay its residents an annual dividend.

Although less than in years past, the lingering effects of the housing crisis still have a negative impact on several of the worst-run states. In five of the 10 worst-run states — Arizona, Georgia, Illinois, New Jersey, and Rhode Island — home values declined by 10% or more between 2009 and 2013. Worse still, in states such as Arizona and Rhode Island, the housing market remains well below its peak, reached just before the start of the recent recession.

While some states’ economic fortunes are closely tied to the rise and fall of individual industries, which are often outside their control, each state must make the best of its own situation. Governments, as stewards of their own economies, need to prepare for the worst, including the collapse of a vital industry. Good governance is about balancing tax collection and state expenditure in a way that provides essential services to residents without sacrificing a state’s long-term fiscal health. Many of the best-run states in the country set money aside each year for emergencies. Should the Alaskan economy run into trouble, the state has enough money in reserve to match more than 21 months of general fund spending.

The scale and complexity of state institutions often make addressing problems at the state level extremely difficult. As a result, our list of the best- and worst-run states tends to remain largely unchanged from one year to the next.

There were a few states that made remarkable improvements, however. California, Colorado, Florida, and Hawaii all moved up by at least 10 positions on our ranking. Improvements in important factors, such as GDP growth and home value increases, contributed to improved rankings in a number of these states.

Some of the changes in rankings can be attributed to states’ GDP per capita levels and labor force growth, both of which were incorporated in our analysis for the first time this year. For example, California’s GDP per capita of $53,497 in 2013, 12th highest in the nation, helped it move up on this list. Also, Florida’s ranking was bolstered by a 3.8% increase in the labor force between 2009 and 2013, the fourth highest.

To determine how well each state is run, 24/7 Wall St. examined data from numerous sources. From the U.S. Census Bureau, we looked at each state’s finances for the 2012 fiscal year, including revenue, tax collection, pension funding, debt, and expenditure. In order to identify how each state’s economy was performing, we reviewed data on unemployment rates, exports, and GDP. We looked at poverty, educational attainment, violent crime rates, and foreclosures to assess social outcomes and residents’ well-being.

While each state is different, states at both ends of the list share certain characteristics. For example, people living in the worst-run states were apt to have lower standards of living. Violent crime rates were typically higher in these states, and the share of the population in poverty or with at least a high school diploma was lower than the national rate.

The worst-run states also tended to have weak fiscal management, reflected by low pension funding, sparsely padded coffers, and poor credit ratings from Moody’s Investors Service and Standard & Poor’s (S&P). Illinois, the worst-run state in America, received lower ratings than any other state from both agencies. By contrast, the majority of the 10 best-run states had perfect ratings from both agencies.

Unemployment rates were also relatively low in the nation’s best-run states. North Dakota, the top-ranked state, had an unemployment rate of 2.9% last year, the best in the U.S. In all, eight of the 10 best-run states were among the 10 states with the lowest unemployment rates. Meanwhile, unemployment was much more prevalent in the worst-run states. Illinois and Rhode Island, both among the lowest-rated states, also had the nation’s second- and third-worst unemployment rates in 2013, at 9.2% and 9.5%.

These are the best- and worst-run states in America.

1. North Dakota
> Debt per capita: $2,880 (19th lowest)
> Credit Rating (S&P/Moody’s): AAA/Aa1
> 2013 unemployment rate: 2.9% (the lowest)
> Median household income: $55,759 (19th highest)
> Poverty rate: 11.8% (10th lowest)

North Dakota is 24/7 Wall St.’s best-run state for a third consecutive year. People have been flocking to North Dakota: more than 5% of the population in 2013 had migrated from another state or country since 2010. One reason for this is the surging economy. Last year, the state’s GDP rose by 9.7%, the most in the nation. Much of this growth came from the mining industry, which includes oil and gas extraction. In recent years, oil extraction in North Dakota has grown exponentially, driven by drilling in the Bakken formation. This has made the state the second largest oil producer behind Texas. Job growth has also been rapid. North Dakota’s 2.9% unemployment rate was the lowest in the nation last year.

2. Wyoming
> Debt per capita: $2,269 (12th lowest)
> Credit Rating (S&P/Moody’s): AAA/NGO
> 2013 unemployment rate: 4.6% (6th lowest)
> Median household income: $58,752 (13th highest)
> Poverty rate: 10.9% (6th lowest)

Wyoming’s economy grew by 7.6% last year, the second fastest growth rate in the country behind only North Dakota, and several times the U.S. growth rate of just under 2%. Further, Wyoming is exceptionally productive, with a GDP per capita of $67,857, trailing only Alaska and North Dakota. Wyoming also has extremely strong state finances, with reserves equal to more than 50% of its 2014 general fund expenditures, an AAA credit rating from S&P, and far less debt than most states. A huge reason for the state’s strong economy and financial position is the energy industry. Wyoming accounted for 39% of all coal produced in the U.S. in 2012, far more than any other state. All eight of the largest U.S. coal mines are located in the state’s Powder River Basin. Wyoming is also a major oil and natural gas producer.

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3. Nebraska
> Debt per capita: $1,110 (2nd lowest)
> Credit Rating (S&P/Moody’s): AAA/NGO
> 2013 unemployment rate: 3.9% (3rd lowest)
> Median household income: $51,440 (25th highest)
> Poverty rate: 13.2% (17th lowest)

Nebraska has long had low unemployment rates, even during the Great Recession. Last year, just 3.9% of the state’s workforce was unemployed, the third lowest rate in the nation. Further, the state’s economy grew by 3% last year, tied for the 10th highest rate in the country. Contributing to this growth was a strong agriculture industry, which accounted for 6.3% of the state’s output in 2013, more than in all but two other states. Nebraska also received high marks for its low debt — at just $1,110 per capita in fiscal 2012, it was second lowest amount in the nation. Nebraska’s constitution prohibits it from borrowing more than $100,000 in bond debt.

4. Iowa
> Debt per capita: $1,995 (10th lowest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 4.6% (6th lowest)
> Median household income: $52,229 (21st highest)
> Poverty rate: 12.7% (14th lowest)

Iowa’s 2013 unemployment rate of just 4.6% was sixth lowest in the nation. This has likely contributed to the low percentage of residents without health insurance. Just 8.1% of Iowans did not have health care coverage in 2013, the fourth lowest rate in the nation. The state also had the 12th highest GDP growth rate in the nation last year, at 2.9%. Agriculture, in particular, contributed substantially to economic growth. As of last year, agriculture, forestry, fishing, and hunting accounted for 5.8% of GDP in Iowa, more than in all but three other states. Iowa was is the nation’s top producer of corn and soybeans, as well as the top producer of hogs, according to the U.S. Department of Agriculture’s 2012 Census of Agriculture.

5. Minnesota
> Debt per capita: $2,441 (16th lowest)
> Credit Rating (S&P/Moody’s): AA+/Aa1
> 2013 unemployment rate: 5.1% (9th lowest)
> Median household income: $60,702 (9th highest)
> Poverty rate: 11.2% (7th lowest)

Minnesota residents are among the nation’s wealthiest. A typical household reported income of $60,702 in 2013, among the highest nationwide. Similarly, the median home in Minnesota was valued at more than $180,000 that year, among the higher home values in the nation. Valuable property partly explains the state’s strong tax revenue — the state generated nearly $3,800 per capita in fiscal 2012, more than all but a handful of states. Also, Minnesota’s unemployment rate of just 5.1% in 2013 was among the nation’s lowest. Minnesota also boasts a highly educated workforce. More than 92% of adults 25 and older had attained at least a high school diploma, while 33.5% had at least a bachelor’s degree, both among the highest rates nationwide.

6. Utah
> Debt per capita: $2,436 (15th lowest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 4.4% (4th lowest)
> Median household income: $59,770 (11th highest)
> Poverty rate: 12.7% (14th lowest)

Utah is a well-rounded state. In fiscal management, the state received top credit ratings of AAA and Aaa from S&P and Moody’s, respectively, both the highest ratings. The state’s economy is also doing quite well. GDP grew by 3.8% last year, double the U.S. economic growth rate of 1.9% and sixth fastest in the nation. Also, Utah’s unemployment rate of 4.4% last year was tied for fourth lowest. Residents appear to have been benefitting from the state’s business friendly environment and considerable economic growth. Median household income was $59,770 last year, above the U.S. median of $52,250. Utah also offers a very safe environment in which to live and work. There were 224 violent crimes per 100,000 people in the state last year, eighth lowest in the U.S.

7. Alaska
> Debt per capita: $8,039 (4th highest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 6.5% (18th lowest)
> Median household income: $72,237 (2nd highest)
> Poverty rate: 9.3% (2nd lowest)

Alaska’s GDP per capita of $70,113 last year was the highest in the nation,. Just 9.3% of Alaskans lived in poverty last year, versus nearly 16% of all Americans. Alaska weathered the Great Recession better than a majority of states. While home values fell more than 6% between 2009 and last year across the nation, home values in Alaska increased by more than 9% during that time, one of the highest growth rates in the country. Due to the historically large oil industry, Alaskans receive annual payouts from a permanent fund set up by the state. This year, each resident will receive $1,884. The mining industry accounted for more than one quarter of the state’s GDP in 2013, higher than in every state except for Wyoming. However, the sector’s output has slowed. Mining is estimated to have lowered GDP growth by 2.6 percentage points in 2013. As a result, the state’s GDP fell by 2.5% last year, more than any other state.

8. Texas
> Debt per capita: $1,725 (6th lowest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 6.3% (17th lowest)
> Median household income: $51,704 (23rd highest)
> Poverty rate: 17.5% (13th highest)

As the leading producer of both crude oil and natural gas, Texas is the nation’s largest energy-producing state. A relatively large portion of the state’s economic output — 11.1% — came from the mining industry, versus mining’s national contribution to GDP of 2.3% in 2013. Mining was also a major contributor to the state’s 2013 GDP growth of 3.7%, which was almost double that of the nation. Texas led the nation with total exports valued at nearly $280 billion last year. Despite the state’s strong economy, it had among the worst educational attainment rates, with just 82% of adults having a high school diploma as of 2013. Similarly, it had among the worst rates of health insurance coverage, with more than 22% of the population uninsured.

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9. Vermont
> Debt per capita: $5,411 (10th highest)
> Credit Rating (S&P/Moody’s): AA+/Aaa
> 2013 unemployment rate: 4.4% (4th lowest)
> Median household income: $52,578 (20th highest)
> Poverty rate: 12.3% (12th lowest)

At 35.7%, Vermont had among the largest percentages of adults with at least a bachelor’s degree as of 2013. Not only that, but this was a 2.6 percentage point increase from 2009, the third highest increase nationwide. Vermont also had the lowest crime rate in the country, with just 121 violent crimes reported per 100,000 people in 2013. Further, only 7.2% of residents did not have health insurance, half the national rate, and lower than in all but two other states. Comprehensive health coverage is just one example of Vermont’s generous welfare programs. With $4,400 in tax revenue per capita in 2012 — third highest nationwide — Vermont’s social programs are relatively well funded. Despite the state’s strengths, Vermont was one of only a few states to report negative net migration from mid-2010 through mid-2013.

10. South Dakota
> Debt per capita: $4,270 (13th highest)
> Credit Rating (S&P/Moody’s): AA+/NGO
> 2013 unemployment rate: 3.8% (2nd lowest)
> Median household income: $48,947 (22nd lowest)
> Poverty rate: 14.2% (23rd lowest)

South Dakota’s unemployment rate of 3.8% last year was lower than that of every state except for North Dakota. The state’s thriving agricultural industry is a major contributor to growth. Much of the state’s 3.1% GDP growth between 2012 and last year came from the sector, which accounted for 8.4% of total state output. By contrast, agriculture accounted for just 1% of the nation’s GDP. South Dakota is a relatively popular destination for Americans looking to move. Nearly 1.8% of all South Dakotans moved to the state between April 2010 and July 2013. Other than a robust economy, the state’s relatively low crime rate of 317 violent crimes per 100,000 people may have also helped attract newcomers.

11. Montana
> Debt per capita: $3,936 (19th highest)
> Credit Rating (S&P/Moody’s): AA/Aa1
> 2013 unemployment rate: 5.6% (14th lowest)
> Median household income: $46,972 (15th lowest)
> Poverty rate: 16.5% (19th highest)

A typical household in Montana had an income of less than $47,000 last year, much lower than the national median household income of $52,250. However, it was also among the states with the fastest GDP growth rates, rising 3% and tying for 10th highest. Home values were also on the rise, climbing 7.8% between 2009 and last year, one of the largest growth rates in the nation. By contrast, home values declined by more than 6% across the nation. Perhaps as a result, the state’s foreclosure rate was nearly the lowest. Last year, just one in every 1,114 homes — or 0.09% of all homes — was in foreclosure. Montana also had among the nation’s lowest crime rates, at just 253 violent crimes per 100,000 people.

12. Hawaii
> Debt per capita: $5,981 (9th highest)
> Credit Rating (S&P/Moody’s): AA/Aa2
> 2013 unemployment rate: 4.8% (8th lowest)
> Median household income: $68,020 (4th highest)
> Poverty rate: 10.8% (5th lowest)

Hawaii collected more than $3,900 in tax revenue per person in fiscal 2012, among the highest amounts in the nation that year. However, Hawaii also had among the highest levels of state debt that year, at nearly $6,000 per person. Moody’s cited several challenges in assigning the state an Aa2 credit rating, including its vulnerability to tourism downswings, low pension funding levels, and high debt ratios. Of course, Hawaii’s credit rating is still firmly investment grade, and the state has more than a few positives in its favor as well. For example, just 6.7% of the state’s population did not have health insurance last year, the second best rate of any state and well below the 14.5% nationwide rate. This has likely been in no small part due to the Hawaii Prepaid Health Care Act, now 40 years old, which requires employers to provide coverage to regular employees.

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13. Delaware
> Debt per capita: $6,262 (7th highest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 6.7% (23rd lowest)
> Median household income: $57,846 (15th highest)
> Poverty rate: 12.4% (13th lowest)

Delaware is among the minority of states with perfect credit ratings from both Moody’s and S&P, with Moody’s citing the state’s exceptional management and a history of maintaining large reserves. Moody’s also identified two challenges for the state: a large debt burden relative to the population and potential exposure to declining activity in the financial sector. As of fiscal year 2012, Delaware had $6,262 in gross debt per capita, among the highest rates in the nation. Additionally, more than 42% of Delaware’s GDP came from the finance, insurance, real estate and rental industries in 2013, which also accounted for 1.2 percentage points of the state’s 1.6% GDP growth.

14. Virginia
> Debt per capita: $3,365 (25th lowest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 5.5% (13th lowest)
> Median household income: $62,666 (8th highest)
> Poverty rate: 11.7% (9th lowest)

A typical Virginia household earned $62,666 last year, considerably higher than the national median household income of $52,250 and among the highest nationwide. Virginians are also well educated. More than 36% of adults had completed at least a bachelor’s degree as of 2013, more than in all but a handful of states. This was also a substantial increase from 2009, when 34% of residents had a bachelor’s degree. In addition, Virginia is relatively safe. There were 196 violent crimes reported per 100,000 people last year, less than in all but two other states. However, residents in the state also face higher prices. As of 2012, Virginia was tied for the 10th highest cost of living in the U.S.

15. Washington
> Debt per capita: $4,173 (15th highest)
> Credit Rating (S&P/Moody’s): AA+/Aa1
> 2013 unemployment rate: 7.0% (23rd highest)
> Median household income: $58,405 (14th highest)
> Poverty rate: 14.1% (22nd lowest)

Washington has been able to attract new residents in recent years. Between April 2010 and July 2013, the state added 126,307 new residents from other states and nations, the equivalent of 1.8% of the state’s 2013 population. Washington also managed its pension funds in a prudent manner. State pension funds were more than 95% funded as of 2013, more than most states. Washington’s GDP per capita of more than $54,654 was also one of the highest in the nation in 2013. Washingtonians have been especially proactive in adopting high minimum wages. The state’s minimum wage of $9.32 an hour is the nation’s highest, and it is also indexed to inflation. Additionally, Seattle recently announced plans to slowly increase the local minimum wage to $15 per hour in the coming years. The nearby city of SeaTac already has a $15 minimum wage, instituted at the start of the year.

16. Idaho
> Debt per capita: $2,447 (17th lowest)
> Credit Rating (S&P/Moody’s): AA+/Aa1
> 2013 unemployment rate: 6.2% (15th lowest)
> Median household income: $46,783 (13th lowest)
> Poverty rate: 15.6% (25th highest)

Idaho has a robust agricultural industry. Agriculture made up 5.4% of the state’s total GDP last year, more than in all but four states. Agriculture was also the largest contributor to the state’s strong GDP growth of 4.1% between 2012 and last year. State residents also benefited from a relatively low crime rate. There were 217 violent crimes reported per 100,000 people last year, lower than in all but a handful of other states. And while the percent of adults with at least a bachelor’s degree was lower than the national rate of 29.6%, the state’s college-attainment rate grew more than in the vast majority of states between 2009 and last year.

17. Colorado
> Debt per capita: $3,100 (20th lowest)
> Credit Rating (S&P/Moody’s): AA/Aa1
> 2013 unemployment rate: 6.8% (25th highest)
> Median household income: $58,823 (12th highest)
> Poverty rate: 13.0% (16th lowest)

Colorado has been a very popular destination in recent years for people looking to relocate. More than 2.4% of the state’s 2013 population moved to Colorado between mid-2010 and mid-2013, the third highest rate nationally. Migrants may be drawn to the state’s growing economy and its well-educated and financially well-off communities. Colorado’s economy grew 3.8% last year, a larger growth than all but five other states. Nearly 38% of Colorado adults had completed at least a bachelor’s degree as of last year, more than in every state except Massachusetts. Colorado residents were also among the least reliant on food stamps, with just 8.6% receiving SNAP benefits last year, versus 13.5% nationwide.

18. Massachusetts
> Debt per capita: $11,923 (the highest)
> Credit Rating (S&P/Moody’s): AA+/Aa1
> 2013 unemployment rate: 7.1% (22nd highest)
> Median household income: $66,768 (6th highest)
> Poverty rate: 11.9% (11th lowest)

Massachusetts had more debt per capita — $11,900 — than any other state in fiscal 2012. Yet, Massachusetts also carries a credit rating of AA+ from S&P, equal to the rating for the United States. This is due, in part, to relatively good fiscal management, a wealthy population, and a strong state economy. The state’s median household income of $66,768 last year was among the highest. Massachusetts also had one of the nation’s highest shares of output from the high-skill professional and business services sector, at 16.7%. The state has a highly educated workforce. More than 40% of adults 25 and older had a college degree as of 2013, the highest rate in the nation. The state also had the lowest rate of people without health insurance, at just 3.7%.

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19. North Carolina
> Debt per capita: $1,857 (8th lowest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 8.0% (12th highest)
> Median household income: $45,906 (11th lowest)
> Poverty rate: 17.9% (11th highest)

Perfect credit ratings from both major agencies, one of the highest pension funded ratios in the nation, and very low levels of debt all helped lift North Carolina into the better-run half of all states. The state has also been among the most successful in attracting new residents, with 1.8% of the 2013 population having migrated to the state since mid-2010. However, state residents are, by some measures, not as well off as Americans elsewhere. North Carolina had a median household income of just $45,906 in 2013, considerably lower than the U.S. median of $52,250 that year. Also, almost 18% of residents lived in poverty last year, worse than the U.S. poverty rate of 15.8%, as well as that of most states.

20. Oregon
> Debt per capita: $3,507 (22nd highest)
> Credit Rating (S&P/Moody’s): AA+/Aa1
> 2013 unemployment rate: 7.7% (15th highest)
> Median household income: $50,251 (23rd lowest)
> Poverty rate: 16.7% (18th highest)

Nearly one in five Oregon residents relied on food stamps last year, the highest figure nationwide. Further, Oregon’s unemployment rate of 7.7% was above the U.S. rate of 7.4% last year. Despite these facts, Oregon scored better overall than the majority of states. Manufacturing accounted for nearly a third of the state’s output last year, well above the 12.5% national share. The sector also contributed substantially to the state’s GDP growth rate last year. Global semiconductor manufacturer Intel’s largest facility is located in Oregon, where it is the largest private sector employer. The Portland area is also home to numerous startup companies and has been dubbed Silicon Forest.

21. Kansas
> Debt per capita: $2,370 (13th lowest)
> Credit Rating (S&P/Moody’s): AA+/Aa2
> 2013 unemployment rate: 5.4% (11th lowest)
> Median household income: $50,972 (24th lowest)
> Poverty rate: 14.0% (20th lowest)

Kansas ranked comparatively well due to its low 2013 unemployment rate, low foreclosure rate, and relatively stable home prices, among other factors. Last year, just 5.4% of the state’s workforce was unemployed, among the better unemployment rates nationwide. Between 2009 and 2013, home values in Kansas rose by more than 3%, despite declining more than 6% nationwide. However, Kansas had one of the nation’s lowest pension funded ratios as of 2013, at just 56.4%. Recent income tax cuts have, according to many observers, caused the state to miss revenue collection estimates and may force it to cut expenditures to keep its fiscal house in order. In August, S&P cut the state’s credit rating from AA+ to AA and identified recent income tax cuts as a contributing factor.

22. West Virginia
> Debt per capita: $3,940 (18th highest)
> Credit Rating (S&P/Moody’s): AA/Aa1
> 2013 unemployment rate: 6.5% (18th lowest)
> Median household income: $41,253 (3rd lowest)
> Poverty rate: 18.5% (10th highest)

West Virginia has had to contend in recent years with a declining coal industry. The once critical sector for jobs has been under pressure from the retirement of coal-based power plants, new environmental regulations, cheap natural gas, and dropping production levels. Despite the ongoing slowdown of a key industry, West Virginia remained among the better half of all states. One reason is that, despite coal’s decline, the state’s GDP still grew by 5.1% in 2013, with mining accounting for virtually all of the state’s growth. This is largely due to the growth of shale gas drilling in the state. Another factor contributing to the state’s relatively high rank is a low foreclosure rate. Just one in every 744 homes was in foreclosure last year, less than in all but three other states. Further, the median home value in the state rose by more than 9% between 2009 and 2013, more than in all but two other states and during a time when home values declined nationwide.

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23. Tennessee
> Debt per capita: $949 (the lowest)
> Credit Rating (S&P/Moody’s): AA+/Aaa
> 2013 unemployment rate: 8.2% (10th highest)
> Median household income: $44,297 (9th lowest)
> Poverty rate: 17.8% (12th highest)

Tennessee had exceptionally strong finances by most metrics reviewed. For instance, more than 91% of its pension liabilities were funded as of 2013, among the highest percentages in the nation. The state also had less than $1,000 in outstanding debt per resident in fiscal 2012, less than any other state. That year, Tennessee had comparatively small tax revenue relative to other states, likely due, at least in part, to the absence of a state income tax on salaries and wages. Also, the state’s residents are not especially well off. Both per capita GDP and median household income were considerably lower in Tennessee than in the nation as a whole in 2013. Individuals were also more likely to live below the poverty line in Tennessee, and households were more likely to rely on food stamps last year.

24. Maryland
> Debt per capita: $4,342 (12th highest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 6.6% (22nd lowest)
> Median household income: $72,483 (the highest)
> Poverty rate: 10.1% (3rd lowest)

Maryland had the highest median household income of any state in 2013, at $72,483. This is one of the major reasons for the state’s top credit ratings. Maryland also has one of the highest percentages of college graduates nationwide, with more than 37% of adults 25 and older holding a bachelor’s degree as of last year. Home values, too, likely benefit from a wealthier population. The state’s median home value of $280,200 in 2013 was fifth highest in the nation. However, Maryland also had one of the nation’s highest foreclosure rates, with 1 in 64 homes in foreclosure in 2013. Further, Maryland’s economy did not grow at all in 2013. The federal government shutdown last fall was likely a big factor in this. Government accounted for 20.8% of state GDP in 2013, among the highest levels in the nation.

25. Oklahoma
> Debt per capita: $2,592 (18th lowest)
> Credit Rating (S&P/Moody’s): AA+/Aa2
> 2013 unemployment rate: 5.4% (11th lowest)
> Median household income: $45,690 (10th lowest)
> Poverty rate: 16.8% (17th highest)

A typical family in Oklahoma earned $45,690 in 2013, one of the lowest median household incomes nationwide. However, the state’s economy grew 4.2% between 2012 and 2013, more than double the national rate of 1.9%. The state’s mining sector, which made up 12.4% of Oklahoma’s GDP last year, accounted for the bulk of economic growth. Oklahoma is one of the top oil and natural gas producing states in the U.S. It also generates more gypsum rock than any other state. The mineral is used primarily in roads and construction materials, but can be found as well in a variety of foods, including beer and bread. In addition to strong growth, Oklahoma also had one of the nation’s lowest unemployment rates last year, at 5.4%.

26. Wisconsin
> Debt per capita: $4,004 (16th highest)
> Credit Rating (S&P/Moody’s): AA/Aa2
> 2013 unemployment rate: 6.7% (23rd lowest)
> Median household income: $51,467 (24th highest)
> Poverty rate: 13.5% (18th lowest)

Perhaps no number stands out more for Wisconsin than its pension funded ratio of 99.9% as of 2013. Further, Governor Scott Walker’s controversial collective bargaining reform law, Act 10, lowered costs for the state by shifting more periodic pension costs to employees. Yet, Walker’s reputation for saving is not impeccable. Wisconsin’s Legislative Fiscal Bureau projects a nearly $1.8 billion shortfall heading into the 2015-2017 budget, with independent fact-checking website Politifact calling alternative projections by Walker “rosy.” Outside of budgetary matters, Wisconsin also scored well for the percentage of residents without health insurance, which stood at just 9.1% last year — better than in all but five other states.

27. Florida
> Debt per capita: $1,952 (9th lowest)
> Credit rating (S&P/Moody’s): AAA/Aa1
> Unemployment rate: 7.2% (21st highest)
> Median household income: $46,036 (12th lowest)
> Pct below poverty line: 17.0% (15th highest)

Already one of the nation’s largest states, Florida’s population has continued to grow in recent years. As of last July, 3.2% of the state’s population had migrated to Florida since mid-2010, either from a foreign country or another state. In all, more than 600,000 people moved to the state in that time. The influx of new residents has likely contributed to a moderate rise in home values from 2012 to 2013. However, due in large part to the housing crisis, home values last year were still 16% lower than they were in 2009. This is among the largest declines in the nation. And while the housing market has recovered to some degree, it will likely be a while until Florida homes sales return to the prices seen at the market’s peak in late 2006.

28. Indiana
> Debt per capita: $3,426 (24th highest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 7.5% (18th highest)
> Median household income: $47,529 (17th lowest)
> Poverty rate: 15.9% (23rd highest)

The manufacturing industry accounted for 30% of Indiana’s economic output in 2013, more than double the industry’s 12.5% contribution to U.S. GDP. The sector was also the largest contributor to the state’s overall GDP growth last year. Motor vehicle and machinery production dominates the state’s manufacturing. Subaru and Honda have large production facilities located there. Like other U.S. manufacturing centers, Indiana’s economy was hit hard by the Great Recession. The state’s median home value was $122,200 in 2013, well below the national home value of $173,900.

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29. Maine
> Debt per capita: $4,220 (14th highest)
> Credit Rating (S&P/Moody’s): AA/Aa2
> 2013 unemployment rate: 6.7% (23rd lowest)
> Median household income: $46,974 (16th lowest)
> Poverty rate: 14.0% (20th lowest)

Maine has a relatively small population and is one of the nation’s most rural regions. Low population density may partly explain Maine’s low violent crime rate of 129 violent crimes per 100,000 people, the second lowest rate nationwide. However, Maine also has one of the nation’s smallest economies, with a 2013 GDP per capita of $38,517, less than that of all but a handful of states. While Maine is a popular destination among vacationers and tourists, its population fell between the middle of 2010 and July 2013, one of only two states with a decline in population. While the college attainment rate among Maine adults was middle of the road as of last year, nearly 92% had completed at least high school, the fifth best rate in the nation.

30. California
> Debt per capita: $3,987 (17th highest)
> Credit rating (S&P/Moody’s): A/Aa3
> Unemployment rate: 8.9% (4th highest)
> Median household income: $60,190 (10th highest)
> Pct below poverty line: 16.8% (17th highest)

California is by far the nation’s most populous state, with more than 38 million people as of last year. Yet, for many residents, life in California can be difficult. Last year, 17.2% of Californians did not have health insurance, among the higher rates nationwide. And while California had a median household income of $60,190 in 2013, the 10th highest in the nation, its poverty rate of 16.8% was higher than the national rate of 15.8%. California’s supplemental poverty measure — which adds noncash benefits, subtracts taxes, and adjusts for area housing costs — of 23.4% between 2011 and 2013 was the worst in the nation. One contributing factor appears to be the high cost of living, which, as of 2012, was the fourth highest in the nation.

31. New Hampshire
> Debt per capita: $6,067 (8th highest)
> Credit Rating (S&P/Moody’s): AA/Aa1
> 2013 unemployment rate: 5.3% (10th lowest)
> Median household income: $64,230 (7th highest)
> Poverty rate: 8.7% (the lowest)

In fiscal 2012, New Hampshire raised just $1,666 per resident in tax revenue, the lowest of any state. Of course, that is partly by design, since New Hampshire does not have a state sales tax and does not apply an income tax to earnings — only to dividends and interest income. However, New Hampshire also received low marks for its relatively sparse level of reserves in the most recent fiscal year, as well as for the 56.7% pension funded ratio it had as of 2013, the fourth lowest in the nation that year. Yet, New Hampshire boasts the nation’s lowest poverty rate, at just 8.7% in 2013 and well below the 15.8% nationally. It also scored well for its highly educated population, low crime rates, and for one of the highest median household incomes in the nation, at over $64,000 in 2013.

32. Connecticut
> Debt per capita: $8,889 (2nd highest)
> Credit Rating (S&P/Moody’s): AA/Aa3
> 2013 unemployment rate: 7.8% (13th highest)
> Median household income: $67,098 (5th highest)
> Poverty rate: 10.7% (4th lowest)

While Connecticut is in the worst-run half of all states, its residents are relatively well off. A typical Connecticut household earned more than $67,000 in 2013, a higher median income than in all but four other states. Property values are also very high. A typical Connecticut home was valued at $267,000, versus the national median of $173,900 in 2013. Additionally, less than 10% of residents did not have health insurance last year, one of the lowest rates nationwide. Yet, while high incomes are generally favorable for residents, they can also often reflect a high cost of living. As of 2012, Connecticut had the nation’s sixth highest cost of living. The state also had one of the highest foreclosure rates last year, with one out of every 74 housing units in foreclosure. More residents left the state than have moved to Connecticut between 2010 and 2013.

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33. New York
> Debt per capita: $6,915 (6th highest)
> Credit rating (S&P/Moody’s): AA/Aa1
> Unemployment rate: 7.7% (15th highest)
> Median household income: $57,369 (16th highest)
> Pct below poverty line: 16.0% (21st highest)

New York scored well for a pension funded ratio of 87.3% as of 2013 and for its ability to raise revenues, with more than $3,600 per capita in tax revenue in fiscal 2012. The state had a substantial amount of debt that fiscal year, however, at more than $6,900 per person. Yet, improved financial management led Moody’s to recently upgrade New York’s credit rating from Aa2 to Aa1. Beyond its finances, New York benefitted from a per capita GDP of $62,420 in 2013, among the highest in the nation. This is, in part, due to its prominent finance, insurance, and real estate industries, which together accounted for 28.8% of New York’s GDP in 2013, a higher share than in all but two other states.

34. South Carolina
> Debt per capita: $3,111 (21st lowest)
> Credit Rating (S&P/Moody’s): AA+/Aaa
> 2013 unemployment rate: 7.6% (16th highest)
> Median household income: $44,163 (7th lowest)
> Poverty rate: 18.6% (9th highest)

People are moving to South Carolina much faster than they are leaving. The state added nearly 100,000 new residents from other states and countries between mid-2010 and mid-2013. While this is a good sign for the future, South Carolina trails most states in a variety of economic and social outcomes. The state’s GDP per capita of $36,059 in 2013 was lower than that of all but two other states. Poverty was also quite high. The 18.6% poverty rate in South Carolina was among the nation’s highest. Also, there were 509 violent crimes reported per 100,000 people in 2013, one of the highest rates in the nation.

35. Arkansas
> Debt per capita: $1,206 (3rd lowest)
> Credit Rating (S&P/Moody’s): AA/Aa1
> 2013 unemployment rate: 7.5% (18th highest)
> Median household income: $40,511 (2nd lowest)
> Poverty rate: 19.7% (4th highest)

Arkansas was among the states that elected to expand Medicaid coverage under the Affordable Care Act. While the implementation of the act is projected to lower the level of uninsured Americans significantly, according to groups such as Gallup and RAND Corporation, the change has been particularly dramatic in Arkansas. According to Gallup, Arkansas had the largest drop in the percentage of adults without health insurance between 2013 and mid-2014. Arkansas had just $1,206 in total debt per person as of fiscal 2012, the third lowest figure in the nation. However, state residents are also quite poor. Nearly 20% of residents lived in poverty in 2013, and a typical household earned slightly more than $40,500, both among the worst figures in the country. Educational attainment in the state was also quite low. Just 84.4% of Arkansans 25 and older had a high school diploma in 2013, while just 20.6% had a bachelor’s degree, both among the lowest rates in the U.S.

36. Pennsylvania
> Debt per capita: $3,617 (21st highest)
> Credit rating (S&P/Moody’s): AA/Aa3
> Unemployment rate: 7.4% (20th highest)
> Median household income: $52,007 (22nd highest)
> Pct below poverty line: 13.7% (19th lowest)

Pennsylvania’s economy demonstrated little growth in 2013, as GDP grew by just 0.7%, or less than all but a few other states. This was despite the state’s ongoing natural gas boom. Natural gas production in the state exceeded more than 3 trillion cubic feet last year. This was more than any other state except Texas. The state’s finances also contributed to its mediocre rank. Pennsylvania had a pension funded ratio of less than two-thirds of the present value of its liabilities as of 2013, worse than in the majority of states. Also, Moody’s recently downgraded Pennsylvania’s debt from Aa2 to Aa3, highlighting “the commonwealth’s growing structural imbalance, exacerbated by the fiscal 2015 enacted budget that depends on non-recurring resources.”

37. Ohio
> Debt per capita: $3,156 (23rd lowest)
> Credit rating (S&P/Moody’s): AA+/Aa1
> Unemployment rate: 7.4% (20th highest)
> Median household income: $48,081 (19th lowest)
> Pct below poverty line: 16.0% (21st highest)

Ohio’s labor force declined by 2.5% between 2009 and 2013, nearly the largest drop among all states. And although Ohio’s home values decreased in line with the national decline of 6.1% between 2009 and 2013, its foreclosure rate in 2013 was considerably worse than most states, at one in every 65 homes. But there has been progress in some areas. Last year, 7.4% of Ohio’s workforce was unemployed, in line with the national rate and down considerably from 2009, when the unemployment rate averaged 10.2% for the year. Similarly, employment, which had dropped significantly during the recession, has picked up in recent years. Ohio is also relatively safe. There were 286 violent crimes reported in 2013, less than the national rate.

38. Nevada
> Debt per capita: $1,397 (5th lowest)
> Credit Rating (S&P/Moody’s): AA/Aa2
> 2013 unemployment rate: 9.8% (the highest)
> Median household income: $51,230 (25th lowest)
> Poverty rate: 15.8% (24th highest)

Nevada’s economy was among the hardest hit by the Great Recession, and the state is still on a long road to recovery. Nearly 10% of the workforce was unemployed last year, the worst unemployment rate nationwide. Although the median home value rose by nearly 10% between 2012 and 2013, the largest increase in the nation, values were still far lower than in the past. The 2013 median home value was still more than 20% lower than the 2009 value, the largest decline in the U.S. Nevada also struggles with low educational attainment rates and a high violent crime rate. While nearly 30% of U.S. adults had attained at least a bachelor’s degree as of last year, only 22.5% had done so in Nevada. And the state’s violent crime rate, at more than 600 reported incidents per 100,000 residents, was nearly the highest in the nation.

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39. Michigan
> Debt per capita: $3,115 (22nd lowest)
> Credit Rating (S&P/Moody’s): AA-/Aa2
> 2013 unemployment rate: 8.8% (5th highest)
> Median household income: $48,273 (20th lowest)
> Poverty rate: 17.0% (15th highest)

As of 2013, 8.8% of Michigan workers were unemployed, among the highest rates nationwide. The high unemployment rate may, in part, explain why more than 68,000 people moved out of the state between mid-2010 and mid-2013. Still, it represents a dramatic improvement from Michigan’s peak annual unemployment rate of 13.5% in 2009, the highest in the country at the time. One likely contributing factor to this is the recovery of the automotive industry. Michigan is also among the top exporting states in the nation. Last year, exports originating from Michigan totalled $5,927 per resident, higher than in all but five other states. Almost half of all exports, by value, were transportation equipment. However, the state’s credit ratings of AA- and Aa2, from S&P and Moody’s respectively, are not especially strong. Worse yet, Detroit became the largest city in U.S. history to declare bankruptcy when it filed for Chapter 9 protection last year.

40. Louisiana
> Debt per capita: $3,333 (24th lowest)
> Credit Rating (S&P/Moody’s): AA/Aa2
> 2013 unemployment rate: 6.2% (15th lowest)
> Median household income: $44,164 (8th lowest)
> Poverty rate: 19.8% (3rd highest)

Louisiana had one of the lowest median household incomes in the nation in 2013, at just $44,164, and 10.7% of all households reported an income of less than $10,000, a higher rate than in any state except for Mississippi. Largely due to these low incomes, The poverty rate in Louisiana was nearly 20% and 17.2% of households used food stamps last year, both among the highest rates in the nation. The state’s GDP grew by 1.3% last year, less than the U.S. overall. This was largely due to a decline in output from the mining industry, which accounted for 8% of Louisiana’s output, versus 2.3% across the country. Louisiana’s ranking was bolstered by its high exports, which equaled $13,693 per capita in 2013, the most in the nation. Last year, products made from petroleum and coal accounted for more than 40% of the state’s exports.

41. Alabama
> Debt per capita: $1,804 (7th lowest)
> Credit Rating (S&P/Moody’s): AA/Aa1
> 2013 unemployment rate: 6.5% (18th lowest)
> Median household income: $42,849 (4th lowest)
> Poverty rate: 18.7% (7th highest)

Like many other states at the bottom of the list, Alabama residents are quite poor. More than 10% of households in Alabama earned less than $10,000 last year, and nearly 19% of state residents lived in poverty, both among the highest rates in the country. Poor educational attainment rates likely contribute to the state’s low incomes. Just 23.5% of adults had at least a bachelor’s degree as of last year, one of the lowest rates nationwide. Despite the potentially discouraging economic outcomes, Americans are still moving to Alabama faster than they are leaving. More than 17,000 people elected to move to the state between mid-2010 and mid-2013 from either other states or foreign countries.

42. Missouri
> Debt per capita: $3,373 (25th highest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 6.5% (18th lowest)
> Median household income: $46,931 (14th lowest)
> Poverty rate: 15.9% (23rd highest)

Missouri’s GDP grew by just 0.8% between 2012 and 2013, one of the lowest growth rates nationwide. A typical household earned less than $47,000 in 2013, one of the lower median household incomes. But while incomes in the state are relatively low, Missouri also had nearly the lowest cost of living in the nation in 2012. Missouri’s housing market is also weak. A typical home in Missouri was valued at $133,200 last year, one of the lower figures nationwide. The median home value also declined by 1.3% between 2012 and last year, a larger decline than in all but one other state. The state received perfect credit ratings from both Moody’s and S&P, despite the fact that it raises comparatively less tax revenue than most states. As of fiscal 2012, the state had revenues of just $1,787 per capita, fifth lowest in the U.S.

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43. New Jersey
> Debt per capita: $7,287 (5th highest)
> Credit Rating (S&P/Moody’s): A+/A1
> 2013 unemployment rate: 8.2% (10th highest)
> Median household income: $70,165 (3rd highest)
> Poverty rate: 11.4% (8th lowest)

New Jersey is one of only a handful of states where debt exceeded the state’s fiscal 2012 revenues. The state reported $7,287 in debt per capita in fiscal 2012, among the highest figures nationwide. Due to its difficulties in maintaining a balanced state budget, Moody’s awarded New Jersey among the lowest ratings of any state, as well as a negative outlook. On the other hand, New Jersey residents are among the nation’s wealthiest. A typical household earned more than $70,000 in 2013, higher than the median household income in all but two other states. A typical New Jersey home was also worth well over $300,000 in 2013, versus the national median home value of $173,900. However, residents may not be as well off as they seem as the cost of living in New Jersey was 14% higher than the rest of the country in 2012, the third highest cost of living nationwide.

44. Georgia
> Debt per capita: $1,341 (4th lowest)
> Credit Rating (S&P/Moody’s): AAA/Aaa
> 2013 unemployment rate: 8.2% (10th highest)
> Median household income: $47,829 (18th lowest)
> Poverty rate: 19.0% (5th highest)

Nearly 19% of Georgia residents did not have health insurance last year, one of the worst rates nationwide. Georgia also had the one of the nation’s worst unemployment rates in 2013, at 8.2%. And poverty is spreading to more parts of the state. According to a 2013 report by the Brookings Institution, the number of people living in poverty in the Atlanta suburbs rose 159% between 2000 and 2011. A high unemployment rates exacerbates the financial hardship of many residents. Georgia’s poverty rate was 19% last year, also among the worst in the country. Further, Georgia’s housing market is also relatively weak. Median Georgia home values fell 13% between 2009 and 2013, nearly the largest drop nationwide. There was a foreclosure filing for one in every 72 homes in 2013, also worse than in all but a handful of states.

45. Arizona
> Debt per capita: $2,140 (11th lowest)
> Credit Rating (S&P/Moody’s): AA-/Aa3
> 2013 unemployment rate: 8.0% (12th highest)
> Median household income: $48,510 (21st lowest)
> Poverty rate: 18.6% (9th highest)

Few states received lower credit ratings than Arizona from the two largest rating agencies, S&P and Moody’s. S&P awarded the state a rating of AA-, while Moody’s rates Arizona an Aa3 on its scale, both worse than most states. However, Moody’s recently upgraded the state’s outlook on improved fund balances, as well as low debt and net pension liabilities. Additionally, as with Florida, Arizona is in the midst of a housing market recovery after a brutal downturn during the recession. Last year, home values in the state rose 9.2% from the year before, better than all states except for Nevada. Despite this, the median home value was still down by nearly 12% between 2009 and 2013, by comparison, the U.S. median home value fell 6% in that time.

46. Kentucky
> Debt per capita: $3,436 (23rd highest)
> Credit Rating (S&P/Moody’s): AA-/Aa2
> 2013 unemployment rate: 8.3% (7th highest)
> Median household income: $43,399 (5th lowest)
> Poverty rate: 18.8% (6th highest)

Kentucky had one of the lowest violent crime rates in 2013, at 210 incidents per 100,000 residents. But while Kentucky is relatively safe, its residents are worse-off financially than those in the vast majority of states. A typical household earned less than $44,000 in 2013, lower than in all but four other states. Due in part to the low incomes, more than 17% of Kentucky households used food stamps last year, nearly the highest rate nationwide. Low educational attainment rates likely explain in part the poor economic outcomes in Kentucky. As of 2013, just 84.1% of adults had completed at least high school, and less than 23% had completed at least a bachelor’s degree. Both of these were among the lowest rates nationwide.

47. Rhode Island
> Debt per capita: $8,761 (3rd highest)
> Credit Rating (S&P/Moody’s): AA/Aa2
> 2013 unemployment rate: 9.5% (2nd highest)
> Median household income: $55,902 (18th highest)
> Poverty rate: 14.3% (24th lowest)

Rhode Island is one of only two states that declined in population in recent years. The total state population dropped by more than 1,000 between April 2010 and July 2013. Driving this change was the fact that more people left than relocated to Rhode Island. A poor job market may account for part of the exodus — 9.5% of the state’s workforce was unemployed as of last year, the second highest rate nationwide. A typical home in the area was worth $232,300 in 2013, one of the highest median values in the nation. However, this was after a 13% decrease from 2009, nearly the worst drop in property values nationwide. Rhode Island’s state debt level totalled 116% of revenue in fiscal 2012, one of only a few states where debt levels exceeded a year of revenue.

48. Mississippi
> Debt per capita: $2,405 (14th lowest)
> Credit Rating (S&P/Moody’s): AA/Aa2
> 2013 unemployment rate: 8.6% (6th highest)
> Median household income: $37,963 (the lowest)
> Poverty rate: 24.0% (the highest)

Mississippi had the least productive economy in the nation with a GDP per capita of just $32,421 in 2013. By comparison, U.S. GDP per capita was $49,115 that year. Many residents also struggled to find work in the state. Mississippi’s unemployment rate was 8.6% last year, among the highest in the nation. Poor economic productivity and few jobs may explain the state’s low incomes. Last year, the median household income in Mississippi was just $37,963, and 12% of households reported incomes of $10,000 or less, both were the worst of any state. Mississippi had the lowest cost of living in the country in 2012. However, very low incomes still make life difficult for many residents. Mississippi had the nation’s highest poverty rate in 2013, when 24% of the population lived below the poverty line. It also had the second highest share of households that used food stamps last year, at 19.4%.

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49. New Mexico
> Debt per capita: $3,621 (20th highest)
> Credit Rating (S&P/Moody’s): AA+/Aaa
> 2013 unemployment rate: 6.9% (24th highest)
> Median household income: $43,872 (6th lowest)
> Poverty rate: 21.9% (2nd highest)

New Mexico struggles with poverty and low incomes. Nearly 22% of New Mexico residents lived in poverty last year, the second highest rate after Mississippi. A typical household in New Mexico earned less than $44,000 in 2013, below all but a handful of states. The state’s crime rate was also higher than in all but one other state, with 613 violent crimes reported per 100,000 residents in 2013. Like several other states at the bottom of the list, people left New Mexico faster than they moved into the state. Between the middle of 2010 and July 2013, the state lost 9,750 residents to migration alone. S&P recently revised its outlook on New Mexico’s credit rating to negative from stable. The revision was based on New Mexico’s weak economic recovery from the recession and over-reliance on government aid and the energy sector.

50. Illinois
> Debt per capita: $4,992 (11th highest)
> Credit Rating (S&P/Moody’s): A-/A3
> 2013 unemployment rate: 9.2% (3rd highest)
> Median household income: $56,210 (17th highest)
> Poverty rate: 14.7% (25th lowest)

Illinois is the worst-run state in the nation. Like many other low-ranked states, more people left Illinois than moved there. Illinois lost more than 137,000 residents due to migration between the middle of 2010 and July 2013. A poor housing market may partly explain the exodus. Median home values fell 16.2% between 2009 and 2013, the second largest drop nationwide. Illinois has extremely poor finances by many measures. Just 39.3% of Illinois’ pension liabilities were funded as of 2013, worse than any other state. Further, the state’s reserves are estimated at just 0.5% of its general fund expenditure, the second lowest reserves rate nationwide. Both Moody’s and S&P gave Illinois the worst credit ratings of any state, at A3 and A- respectively. According to Moody’s, the state’s rating reflects its low fund balances and high pension obligations, as well as its “chronic use of payment deferrals to manage operating fund cash.”

To determine the best- and worst-run states, 24/7 Wall St. collected data in three major categories: financial position, economic outcomes, and social outcomes. We averaged the rank of each data point to create a meta rank ranging from 1-50. All data points received equal weight.

In the financial category, we included data on reserves as a percent of general fund expenditures from the Pew Charitable Trusts’ “Fiscal 50: State Trends and Analysis” report published in November 2014. This data reflect the extent to which states are insulated from deteriorating economic conditions as of fiscal 2014. We also looked at data from Bloomberg on the percent of pensions that were fully funded. Data are for 2013 and reflect each state’s most current fiscal year. Total tax revenue per capita, state debt per capita, and debt as a percent of revenue are all from the U.S. Census Bureau and are for fiscal 2012.

One result of a state’s fiscal prudence is a higher credit rating. We considered the most recent credit rating data from Standard & Poor’s and Moody’s Investors Service. Also in the economic outcomes category, we included the percent of residents without health insurance, median household income, median home value, and the value of exports per capita from the U.S. Census Bureau for 2013. From the Bureau of Economic Analysis we used data on per capita real GDP from 2013 and GDP growth, including a breakdown by industry, from 2012 to 2013. We also used 2013 unemployment figures and labor force growth between 2009 and 2013 from the Bureau of Labor Statistics. Foreclosure rates are from RealtyTrac and cover 2013.

In the social outcomes category, we examined the percent of people living below the poverty level as well as the share of each state’s population with at least a high school diploma, both from the U.S. Census Bureau for 2013. Violent crime rates, published by the Federal Bureau of Investigation’s 2013 Uniform Crime Report, were also considered.

This is the fifth consecutive year that 24/7 Wall St. has published this report. While many of the key elements of our analysis have remained the same, it is important to recognize how this year’s report differs from previous iterations. Rather than include data on budget shortfalls, we looked at reserves as a percent of total expenditures. New to this year’s report is data on per capita real GDP, labor force growth over the previous five years, total tax revenue per capita, total net migration, and a one-year change in median home values.