Special Report
The Best and Worst Run States in America: A Survey of All 50
December 3, 2014 6:20 pm
Last Updated: December 4, 2019 7:48 am
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.
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