Economy

States With the Most Government Benefits

10. Massachusetts
> Economic security grade: C
> Median household income: $62,859 (5th highest)
> Gov’t spending per capita, 2011: $7,977 (9th highest)
> Tax collections per capita, FY 2011: $3,361 (9th highest)

Massachusetts’ income policies contribute positively to residents’ economic security, according to WOW. The state has a relatively high minimum wage, at $8.00 an hour, 75 cents above the federal minimum wage of $7.25. Should the federal government raise the minimum wage above the state’s level, Massachusetts’ minimum wage law update policy requires the state’s minimum wage be automatically raised 10 cents above the new federal minimum. Additionally, Massachusetts also received good grades from WOW for its tax credit policies. However, the state does little to expand on the Families and Medical Leave Act, which allows workers to take time off in an emergency without fear of losing their jobs.

Also Read: Countries Where Workers Get the Most Time Off

9. Iowa
> Economic security grade: C
> Median household income: $49,427 (24th highest)
> Gov’t spending per capita, 2011: $6,510 (25th lowest)
> Tax collections per capita, FY 2011: $2,368 (24th highest)

Iowa is one of just four states to receive an A+ for child care spending per capita. Other areas where Iowa performs well include asset limits for SNAP — formerly known as food stamps — and school finance equity. The state spent $1,600 on public welfare per capita, more than nearly two-thirds of all states. Unlike most of the states that provide more government benefits, Iowa brings in relatively little in tax revenue, at just $2,368 per capita in 2011.

8. New York
> Economic security grade: C
> Median household income: $55,246 (16th highest)
> Gov’t spending per capita, 2011: $9,453 (3rd highest)
> Tax collections per capita, FY 2011: $3,497(8th highest)

New York has a child and dependent care tax credit that can be as much as 110% of the federal credit for lower income families. But despite this benefit and other similarly generous policies, many New Yorkers still face economic insecurities. Unemployment insurance in the state covered just 25.6% of a worker’s former wages at the end of 2011, one of the lowest figures in the nation. Also, the state has comparatively poor sick leave policies, according to WOW, although this may change for many New York City residents. The City Council recently approved new changes requiring all businesses with more than 20 employees to offer five paid sick days a year.

7. Maine
> Economic security grade: C
> Median household income: $46,033 (19th lowest)
> Gov’t spending per capita, 2011: $6,851 (22nd highest)
> Tax collections per capita, FY 2011: $2,768 (14th highest)

Maine is only one of two states to receive an A for child care accessibility. In addition, as of 2012, a family of three with a working parent in Maine making up to $37,060 could remain on Medicaid, one of the most generous states in that regard. Maine spent $2,187 per capita on public welfare in 2012, higher than all but five other states. However, the generosity comes at a cost. Maine residents paid $2,768 per capita in state and local taxes in fiscal 2011, among the top third of all states. This was despite the fact that the household median income was nearly $4,500 lower than the U.S. median.

6. New Jersey
> Economic security grade: C
> Median household income: $67,458 (3rd highest)
> Gov’t spending per capita, 2011: $7,608 (12th highest)
> Tax collections per capita, FY 2011: $3,085 (12th highest)

New Jersey is the only state awarded an A+ for its high Medicaid income limit for senior citizens. Additional state public support programs that distinguish New Jersey are its support for housing trust funds, which use tax revenues to promote affordable housing programs, and its property tax relief initiatives. However, New Jersey’s minimum wage is only equal to the federal minimum. Many of these support systems cost money. New Jersey has high state and local tax collections that equaled more than $3,000 per capita in fiscal 2011. Americans across the nation paid an average of just $2,441.