The state of Washington has the best economic activity in the U.S., and Alaska, the worst, according to a new report, 2019’s Best & Worst State Economies, produced by the personal-finance website WalletHub.
“U.S. economic growth depends heavily on the performance of individual states,” Adam McCann, financial writer at WalletHub writes. “But some contribute more than others.”
In 2017 California’s economy became the fifth largest in the world, McCann notes, while Alaska still struggles with an unemployment rate of 6.5 percent.
The analysis compares the economies of 50 states and the District of Columbia across 28 key indicators. The data set ranges from GDP growth to startup activity to share of jobs in high-tech industries.
The 10 states with the highest “economic activity” rankings are Washington, Utah, Massachusetts, California, Colorado, District of Columbia, Idaho, Oregon, New Hampshire and North Carolina.
States reporting the highest GDP growth are Washington, Utah, Idaho, Arizona and Florida. States with the lowest are Alaska, Wyoming, Delaware, Rhode Island and Montana.
The 10 ranking the worst in “economic activity” are Alaska, Louisiana, Mississippi, Hawaii, West Virginia, Arkansas, Kentucky, Wyoming, Rhode Island and Maine.
The Gulf states of Louisiana and Texas reported the most exports per capita, followed by Washington, North Dakota, Kentucky and South Carolina.
Despite Louisiana’s low economic ranking, it posts the highest value of exports per capita, $14,203, WalletHub notes. A report published by the American Enterprise Institute also ranks Louisiana first for having the highest trade share of its GDP (42 percent). Louisiana is “the most globalized state in the U.S.,” according to the report.
“Reports like this only underscore the fact that despite Louisiana’s wealth of sought-after natural resources, the state’s economy ranks among the worst in the nation,” Daniel Erspamer, CEO of the Pelican Institute for Public Policy, told The Center Square. “Jobs and opportunity aren’t fleeing Louisiana due to a lack of potential. Rather, they are seeking refuge in friendlier neighboring states, because Louisiana’s entrenched, obstructive status quo has made it too difficult to prosper here.”
“Free trade can and should continue to be a major job creator and economic driver for Louisiana, as we serve as America’s gateway to the world,” Erspamer added. “But, as the impacts of the current international dispute are being debated, Louisianans should keep one thing in mind – before we can achieve success on the national and global levels, we must enact smarter, more pro-growth policies here at home.”
Louisiana’s exports are more than 31 times higher than the state with the least amount of exports, Hawaii, according to WalletHub.
WalletHub compared highest and lowest scores across several areas, including employment, poverty levels, annual household incomes, among others.
Vermont has the lowest unemployment rate of 2.5 percent, compared to Alaska’s highest rate of 6.5 percent, the report states.
New Hampshire has the lowest share of the population living in poverty (8.1 percent) while 21.5 percent of people living in Mississippi are at the poverty level.
North Dakota has the lowest foreclosure rate in the U.S. of 0.0053 percent – 18.9 times lower than Delaware’s high 0.1001 percent.
The highest share of high-tech industries isn’t in California’s Bay Area, but in Massachusetts, the report notes; West Virginia has the lowest share. The most startup activity occurred in Florida, Nevada, Colorado, Utah and Missouri; the least in Kentucky, Mississippi, Iowa, Vermont and West Virginia.
John Campbell, a sociology professor at Dartmouth College, noted, “There is no one ‘most effective’ way” for states and local officials to boost their local economies. “Massachusetts offers a highly educated labor force,” he said, as one example, while “New Hampshire offers low tax rates,” as another.
He added that tax rates are not the only issue companies and entrepreneurs consider when making decisions about where to establish their business. They also include, “quality of the labor force, infrastructure, housing availability for prospective employees, cultural amenities (which influence how easy it is to attract workers to the state), the quality of the school system, and potential for public-private partnerships,” he said.
States reporting the highest median annual household income are Virginia, Utah, Minnesota, New Jersey and Maryland. Those with the lowest are New York, Maine, West Virginia, New Mexico and California.
WalletHub evaluated data from the U.S. Census Bureau, Bureau of Labor Statistics, Bureau of Economic Analysis, Deloitte, United Health Foundation, American Legislative Exchange Council, Mercatus Center at George Mason University, Council for Community and Economic Research, and other organizations to compile the report.
This article was first published on The Center Square.