Special Report

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

Source: Thinkstock

31. Ohio
> 2016 Unemployment: 4.9% (20th highest)
> Pension funded ratio: 76.4% (21st highest)
> Credit rating and outlook: Aa1/Stable
> Poverty: 14.6% (18th highest)

As evidenced by the high unemployment in the state and a shrinking labor force, Ohio’s economy is struggling. As of October, 5.1% of the state’s workforce was out of a job, slightly worse than the state’s October 2016 unemployment rate of 5.0% and a break from the national trend of an improving job market.

Like many other states in the Midwest with flagging economies, Ohio is overly dependent on its once strong manufacturing sector. The industry, which has long been in decline in the United States, employs some 15.5% of Ohio’s workforce. In comparison, the manufacturing sector employs only 10.1% of workers nationwide.

Source: Thinkstock

32. New York
> 2016 Unemployment: 4.8% (25th highest)
> Pension funded ratio: 98.1% (3rd highest)
> Credit rating and outlook: Aa1/Stable
> Poverty: 14.7% (16th highest)

Lower-ranked states often have relatively little to work with in the way of tax revenue, but not New York. The state brings in the equivalent of $3,961 per resident a year, more than all but six other states. With strong revenue, New York is one of only a handful of states with a near fully-funded pension system.

Despite the high tax revenues, New York borrows more than most states. New York’s debt is equal to nearly $7,000 per resident, the seventh highest debt per capita among states. New York also struggles more than most states with a weak job market. The state’s October 2017 unemployment rate of 4.8% is effectively unchanged from its October 2016 rate of 4.9%, even as the unemployment nationwide has decline to 4.1% from 4.8% over the same period.

Source: Thinkstock

33. Arizona
> 2016 Unemployment: 5.3% (13th highest)
> Pension funded ratio: 63.2% (12th lowest)
> Credit rating and outlook: Aa2/Stable
> Poverty: 16.4% (8th highest)

Arizona’s job market is hurting, and the state is doing relatively little to help those trying to find work. Some 5.3% of workers in the state were unemployed in 2016 compared to only 4.9% of the U.S. workforce. Of those in Arizona who are out of work, only 16.0% receive unemployment insurance compared to the UI recipiency rate nationwide of 27.0%. Most of those receiving UI benefits are likely still struggling financially. The average UI payout in Arizona covers less than one-quarter of the average working wage, the least generous proportional insurance payout of any state.

Source: Thinkstock

34. South Carolina
> 2016 Unemployment: 4.8% (25th highest)
> Pension funded ratio: 57.8% (7th lowest)
> Credit rating and outlook: Aaa/Stable
> Poverty: 15.3% (14th highest)

Some 15.3% of South Carolinians live below the poverty line compared to 14.0% of Americans. Medicaid is intended to help those facing serious financial hardship afford medical care, and despite standing to gain more than many states, South Carolina did not accept federal money to expand its Medicaid program. Partially as a result, 1 in 10 state residents do not have health insurance coverage, a larger share than in most states.

Overall, the state’s neediest residents do not appear to be high up among the state’s lawmakers’ priorities. South Carolina allocates 29.1% of its annual spending towards welfare programs compared to the average allocation across all states of 33.1%.

Source: Thinkstock

35. Kansas
> 2016 Unemployment: 4.2% (18th lowest)
> Pension funded ratio: 64.9% (16th lowest)
> Credit rating and outlook: Aa2/Negative
> Poverty: 12.1% (20th lowest)

Since Gov. Sam Brownback slashed income taxes in Kansas in 2012 and 2013, the state has struggled to balance its budget. State employee pensions have bared the brunt of much of the tax cuts. Only 64.9% the state’s pension system is funded, compared to the 71.6% average funding across all state pension systems. Not only have the tax cuts made it difficult for Kansas to meet its budgetary obligations, but they have also failed to generate the growth Brownback expected. Economic output contracted by 0.9% in Kansas in 2016, even as GDP nationwide expanded by 1.5% over the same period.

Despite the state’s fiscal troubles in recent years, Kansas’ job market is relatively strong. Only 4.2% of the state’s labor force was out of work in 2016 compared to 4.9% of U.S. workers.

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