Best States for Income

The U.S.Bureau of Economic Analysis (BEA) released its rankings of personal income by state for 2009.

Personal income throughout the U.S. was down 1.7% in 2009.  44 states had declining incomes in 2009.  6 states saw an increase.

The Best State for Income Growth in 2009 was West Virginia with an increase 2.1%.  Despite this growth West Virginia has the 44th lowest income in the U.S. at $32,219. It did improve from a 49th ranking in 2008.

The Worst State For Income Growth was Nevada with a decrease of 4.8%.  Nevada with an income of $38,578 was ranked 20th in the U.S in personal income.

The Best State for Income in 2009 was Connecticut .  It had the highest state income at $54,397.   Additional Top States for Income were  New Jersey, Massachusetts, Maryland and New York .

The Worst State for Income was Mississippi .  At $30,013, it has the lowest state income.  Utah, Idaho, South Carolina and Kentucky were also Worst States for Income in 2009.

Income is only one factor in determining a Best State to Live.  Cost of Living , quality of education and job openings and availability should also be considered.

State Ranking of Income 2009

The ranking of states by income follows:

State Unionism Rankings: Do Highly Unionized States have Higher Unemployment?

Union employment in the U.S. continued to shrink this past year.  Nationwide union participation stands at 12.3% which is a slight decline from 2008.

The BLS 2009 Annual Union Affiliation by Statesurvey was recently published.  It has brought increased attention to the union movement. Union policy will further be in the spotlight this week as the Senate wrestles with the nomination of Craig Becker, a clearly pro-union candidate, to the National Labor Review Board.  See GOP’s Senate Gain Clouds Prospect of Obama’s Labor Board Nominee.  In view of this upcoming debate, we thought it would be helpful to take a deeper look at state unionization and employment.


Let’s take a look at state unionization.

New York is the most unionized state in the nation with 27.2% of its population working for a union.  More than 1 in four workers are represented by a union in New York.  Hawaii at 24.3% is the second most unionized state at 24.3%, followed by Alaska at 23.6%.  Washington, Michigan, and New Jersey are heavily unionized states with about 20% union participation rates.

The least unionized state is North Carolina at 4.4%.  Only one in 23 workers in North Carolina are represented by a union, a sharp difference as compared to New York.  Additional states with low union participation rates are Arkansas at 5.0%, Virginia at 5.4%, South Carolina at 5.4% and Georgia at 5.9%

Twenty seven states had decreased union participation in 2009 as compared with 2008.  States with low union participation rates generally became less so in 2009 and those states with union growth were primarily already highly unionized.  There are 22 states with right to work laws in the U.S.  Right to work laws generally do not require employees to pay fees or join a union even if voted in.

A look at union participation and unemployment shows states with high union participation rates are closely associated with higher unemployment.

The five Worst States for Employment in 2009 were Michigan, Rhode Island, Nevada, California and South Carolina.  All but South Carolina are highly unionized states.  The Worst States for Employment in 2009 generally were highly unionized states.

Worst States for Employment and Union Participation

 

 

The Best States for Employment in 2009 were North Dakota, South Dakota, Nebraska, Iowa, Oklahoma and Kansas. All but Iowa have unionparticipation rates below the U.S. average and would be classified asstates with low unionization.  If you are looking for a job, look at states with low unionization.  They tend to have less unemployment. See  Best and Worst States for Jobs: Will Jobs Improve in 2010 for the rankings of all states by employment.  The list of Best States for Employment and Union Participation follows:

Best States for Employment and Union Participation



The list of Unionism by State follows:

Unionism by State


Union membership has been in a long term decline since 1983 when BLS first started measuring it in a consistent way.  Union participation was 20.1% of the working population in 1983.  It is now approximately 40% lower at 12.3%.  For the first time in 2009, the majority of union members now work for the government and not for private, for profit entities.  These state workers are on average paid significantly more than private industry.  Making it easier for government workers to unionize will only push labor costs higher and cost the taxpayers more.  Political leaders should be trying to keep these costs in check. (The average federal worker’s pay is $71,206 as compared to $40,331 in the private sector and is growing above inflation rates) The Obama administration’s labor policy approach creates a conflict with its responsibilities to protect the taxpayer. Increased unionization will increase our cost of government.  If the Obama administration is serious about job creation and deficit control, it may want to reconsider this approach.  Unions and job creation generally do not have a positive correlation.  Watch the news this week as it relates to Craig Becker.  It will have implications for jobs and deficits.

Best and Worst States for Jobs: Will jobs improve in 2010?

The Bureau of Labor Statistics released state unemployment for December 2009 today.  Every state in the U.S. saw its unemployment rate rise in 2009.

The Best State for Jobs and Employment in 2009 was North Dakota.  It had the lowest unemployment rate in the nation at 4.4%.  Its unemployment rate increased by 1.1% in 2009.  South Dakota, Nebraska, Iowa, Oklahoma and Kansas were also Top States for Jobs and Employment.

The Worst State for Jobs and Employment in 2009 was Michigan.  Its unemployment ended the year at 14.6%, an increase of 4.4% in 2009.  21 states and D.C. saw their unemployment ranks increase by 3% or more in 2009.  2009 was a very bad year for those seeking employment.  Nevada, Rhode Island, South Carolina, California and D.C. all were Worst States for Jobs and Unemployment in 2009.  They all have unemployment rates of 12% or higher.

Minnesota and North Dakota had the smallest unemployment increases in 2009 with increases of only 0.8%. The Worst States for Unemployment Increases were West Virginia and Nevada which had increases of 4.6% in unemployment.  The list of Best and Worst States for Jobs and Employment is below.  It is presented from best to worst based on year over year changes.  Politically, these are very poor numbers for the Obama administration.  With the large health care bill off the table for now, let’s hope businesses will become a little more willing to hire in 2010.

Best and Worst States for Jobs

Source:  Bureau of Labor Statistics

Best States for Sunshine

Sunshine is an under appreciated dimension when thinking about where to live.  It can improve your health and happiness.  Yet rarely do we hear people say they picked a state for its sunshine.  They think more about weather temperature, jobs, taxes, cost of living etc. Sunny states generally qualify as Best States for Retirement and are Happy States according to recent happiness studies.

The Best States for Sunshine are Arizona and Nevada.  Phoenix and Las Vegas each have 310 sunny days a year or 85% sunshine.

The Top 5 States for Sunshine, in addition to Arizona and Nevada, are California, New Mexico and Hawaii. Florida, the Sunshine State, is ranked 7th of all states.

The Worst State for Sunshine is Alaska with only 41% sunny days.  Anchorage has only 150 days a year of sunshine half of Phoenix and Las Vegas.

The 5 Worst States for Sunshine are Alaska, Washington, Oregon, Vermont and Ohio.  All 5 states have sun less than 50% of the time.
The List of Sunshine for all U.S. States is published below.

Rankings of  Sunshine by State

If you are considering what are the Best States for Weather, study the Best States for Sunshine.  You may just end up with happier choices.

Trustworthy States: Best States to Lose Your Wallet

Gallup recently released a poll on Best States to Lose Your Wallet

With unemployment rising and economic stress increasing, the trust we have in our neighbors and community is of increasing concern. We want to live in a Safe States as they are Best States to Live.  The poll asked people if they believed a lost wallet with $200 in would be returned.  Nationwide 70% of people believe that their wallet would be returned with money still in the wallet.  Large States according to Gallup are generally viewed as less trustworthy.  People in the Southern half of the country do not trust their neighbors as much as people in the North. See Gallup’s map below.

The Best States for Neighbor Trust are:

Top 10 States, Trust in Neighbor

The Worst States for Neighbor Trust are:

Bottom 10 States, Trust in Neighbor

People in the South do not trust their neighbors as much as the North according to Gallup. Chart courtesy of Gallup.

U.S. Map: Trust in Neighbor, by State
When picking your place to live consider your neighbors. Safe States are Best States to Retire and are Top States to Live

Top States for Jobs September 2009

The Bureau of Labor Statistics BLS released the September 2009 List of State Unemployment last week.  23 States saw unemployment rise from August, 19 saw decreases and 8 were unchanged.  The US Unemployment rate for September 2009 was 9.8%.

New York was the Worst State for Jobs in September with a loss of 81,700 jobs.

 

Texas (-44,700), California (-39,300), Wisconsin(-21,700), and Michigan (-21,500) rounded out the 5 Worst States
for
Jobs in September. Michigan continues as the Worst State for Employment with a staggering 15.3%
unemployment rate.
Nevada, Alabama, Oregon and West Virginia are also in the 5 Worst States for Employment.
California is not far behind
as a worst state for jobs. See our post on California Jobs Shrinking


 


 
The Best State for Jobs in September 2009 was Indiana which gained 4,400 jobs. The Best State for Employment
was North Dakota with a 4.2% unemployment rate. Only 3 other states qualified as Best States for Jobs in September.
They were New Mexico (+3,700), Nevada (+2,700), and Utah (+2,500). Go to our lastest
September list of job openings by state
for more on where the job openingsAll states and the District of Columbia recorded statistically significant increases in their jobless rates on a year on year basis.
Michigan had the largest increase +6.4%.  Nevada, 6.0% and Alabama at 5.3% also had the highest increases in the U.S.
North Dakota had the smallest increase at +.9%.  The Year on Year change of Unemployment for all 50 States is below.

 

Rank State Sep-08 Sep-09 Change
1 NORTH DAKOTA 3.3 4.2 0.9
2 NEBRASKA 3.4 4.9 1.5
3 SOUTH DAKOTA 3.2 4.8 1.6
4 ALASKA 6.7 8.4 1.7
5 LOUISIANA 5.6 7.4 1.8
5 MISSISSIPPI 7.4 9.2 1.8
7 ARKANSAS 5.2 7.1 1.9
7 MINNESOTA 5.4 7.3 1.9
7 VERMONT 4.8 6.7 1.9
10 COLORADO 5 7 2
10 MONTANA 4.7 6.7 2
12 KANSAS 4.6 6.9 2.3
13 CONNECTICUT 6 8.4 2.4
14 IOWA 4.2 6.7 2.5
15 MARYLAND 4.6 7.2 2.6
15 VIRGINIA 4.1 6.7 2.6
17 OKLAHOMA 4 6.7 2.7
18 HAWAII 4.4 7.2 2.8
18 UTAH 3.4 6.2 2.8
20 MAINE 5.6 8.5 2.9
21 ARIZONA 6 9.1 3.1
21 DELAWARE 5.2 8.3 3.1
21 NEW YORK 5.8 8.9 3.1
21 TEXAS 5.1 8.2 3.1
25 MISSOURI 6.3 9.5 3.2
25 PENNSYLVANIA 5.6 8.8 3.2
27 NEW HAMPSHIRE 3.9 7.2 3.3
27 NEW MEXICO 4.4 7.7 3.3
27 OHIO 6.8 10.1 3.3
30 IDAHO 5.4 8.8 3.4
31 GEORGIA 6.6 10.1 3.5
31 INDIANA 6.1 9.6 3.5
33 TENNESSEE 6.9 10.5 3.6
33 WISCONSIN 4.7 8.3 3.6
33 WYOMING 3.2 6.8 3.6
36 MASSACHUSETTS 5.6 9.3 3.7
37 ILLINOIS 6.7 10.5 3.8
37 WASHINGTON 5.5 9.3 3.8
39 DC 7.4 11.4 4
39 KENTUCKY 6.9 10.9 4
39 NEW JERSEY 5.8 9.8 4
39 NORTH CAROLINA 6.8 10.8 4
43 SOUTH CAROLINA 7.5 11.6 4.1
44 FLORIDA 6.7 11 4.3
45 CALIFORNIA 7.8 12.2 4.4
46 RHODE ISLAND 8.5 13 4.5
47 WEST VIRGINIA 4.3 8.9 4.6
48 OREGON 6.8 11.5 4.7
49 ALABAMA 5.4 10.7 5.3
50 NEVADA 7.3 13.3 6
51 MICHIGAN 8.9 15.3 6.4

Where to Find a Job? Best States for Jobs

The Bureau of Labor Statistics released the July State unemployment numbers this past week.  More ugly in most states.

The Best States for Jobs are primarily heartland states.  The Best State for Jobs is North Dakota with an unemployment rate of only 4.2%.  Nebraska and South Dakota at 4.9% are the only other states under 5%.  Utah is our fourth Best State for Jobs at 6%.  You will have a decent chance to find a job in Iowa, Oklahoma, Wyoming and Montana.

If you are looking for a job in a state with very high unemployment, you might want to consider a state where the opportunities are broader and fewer people looking.  In other words, consider changing your state.  Michigan at 15.2% is the Worst State for Jobs. Approximately  1 in every 6 people are unemployed.  Rhode Island, Nevada, Oregon and California are some of the Worst States for Jobs with rates all close to 12%.

High unemployment also creates a reinforcing negative cycle.  Unemployment creates downward pressure on real estate, commerce and social institutions.   It does not turn around quickly.  While unemployment is one very important metric in your search for employment, job openings i.e. who is hiring now? should also be considered.  For recent info on job openings by state see Best States for Job Openings

 

July U.S. State Unemployment List

 

1 NORTH DAKOTA 4.2
2 NEBRASKA 4.9
2 SOUTH DAKOTA 4.9
4 UTAH 6
5 IOWA 6.5
5 OKLAHOMA 6.5
5 WYOMING 6.5
8 MONTANA 6.7
9 NEW HAMPSHIRE 6.8
9 VERMONT 6.8
11 VIRGINIA 6.9
12 HAWAII 7
12 NEW MEXICO 7
14 MARYLAND 7.3
15 ARKANSAS 7.4
15 KANSAS 7.4
15 LOUISIANA 7.4
18 COLORADO 7.8
18 CONNECTICUT 7.8
20 TEXAS 7.9
21 MINNESOTA 8.1
22 DELAWARE 8.2
23 ALASKA 8.3
24 MAINE 8.4
25 PENNSYLVANIA 8.5
26 NEW YORK 8.6
27 IDAHO 8.8
27 MASSACHUSETTS 8.8
29 WEST VIRGINIA 9
29 WISCONSIN 9
31 WASHINGTON 9.1
32 ARIZONA 9.2
33 MISSOURI 9.3
33 NEW JERSEY 9.3
35 MISSISSIPPI 9.7
36 ALABAMA 10.2
37 GEORGIA 10.3
38 ILLINOIS 10.4
39 DISTRICT OF COLUMBIA 10.6
39 INDIANA 10.6
41 FLORIDA 10.7
41 TENNESSEE 10.7
43 KENTUCKY 11
43 NORTH CAROLINA 11
45 OHIO 11.2
46 SOUTH CAROLINA 11.8
47 CALIFORNIA 11.9
47 OREGON 11.9
49 NEVADA 12.5
50 RHODE ISLAND 12.7
51 MICHIGAN 15

50 States 50 Laboratories, More on the Best and Worst States

We found the recent Economist article, California vs Texas: America’s Future  a positive contribution to the debate on Best and Worst States.

The article points out the marked differences between states and helpsmake the case that the lower tax, less government intrusion model of Texas is winning over California.  This is a case we have long advocated. The Economist also notes the work that this writer has developed overthe last 5 years on Chief Executive’s Best and Worst States for Business.  (Texas is #1 and California is #50 according to CEOs.)

We also would like to make note of a recent blog written by Kurt Brouer titled California or Texas: Which Model is Working Best?  Kurt’s Fundmasteryblog.com is getting it right by making the low tax, more personal freedom case.

With all 50 state governments under severe fiscal pressure, it is only a matter of time that the next phase of recovery will be focused on growth.  You can not spend your way out of a problem.  The severity of this budget crisis may lead finally to a rethinking of attitudes towards business. My list of states that need major rethinking would start with the 10 most broke states.  They are:

1. California: $53.7 billion shortfall or 58 percent of its budget
2. Arizona: $4 billion shortfall or 41 percent of its budget
3. Nevada: $1.2 billion or 38 percent of its budget
4. Illinois: $9.2 billion or 33 percent of its budget
5. New York: $17.9 billion or 32 percent of its budget
6. Alaska: $1.35 billion shortfall or 30 percent of its budget
7. New Jersey: $8.8 billion or 30 percent of its budget
8. Oregon: $4.2 billion or 29 percent of its budget
9. Vermont: $278 million or 25 percent of its budget
10.  Washington: $3.6 billion or 23 percent of its budget
10.  Connecticut: $4.1 billion or 23 percent of its budget

Source:  ABC News

The Top Ten Broke States tend to have the most taxation and most are run by liberal oriented governments.

All 50 states will be politically pressured to increase opportunities and jobs for their populations in the coming years.  Being attractive to business will be the obvious choice.  The wonders of our American system are our many state laboratories.  High Tax States, Low Tax States, Business Friendly States and Business Unfriendly States.  Those states early to adopt policies that encourage business will recover and grow faster than those who are slow.  We are glad to see more publications like The Economist contributing to the debate.  Hopefully we will start to see more low tax, business friendly policy changes in our many laboratories get enacted.

Comment on “Soak the Rich, Lose the Rich”

My good friend Steven Moore along with Art Laffer wrote a great piece today in the Wall Street Journal titled Soak the Rich, Lose the Rich

Their piece reinforces the general messages of this site, namely that there are Best and Worst States in the U.S. to live, create wealth and grow a business.  The story makes a case for common sense state policies of low taxes and favorable business regulatory climate.  In the piece Moore and Laffer point out that the no income tax states have created “89% more jobs and had 32% faster personal income growth than their high-tax counterparts.”  In other words, successful people and businesses go to the more favorable tax and regulatory environments.

We have long advocated state governments to adopt  more business and citizen friendly policy.  Laffer and Moore bring this issue to the forefront today with their well-written piece.  I hope state governors and legislators also read it and take action.

For more on tax policy of states see our posts Best and Worst States for Individual Taxes

and Best and Worst States for Business

For those of you interested the nine no income tax states in the U.S. are  Texas, Nevada, New Hampshire, Florida, South Dakota, Wyoming, Washington, Alaska and Tennessee.  New Hampshire and Tennessee do tax interest and dividends however.

Are Pay Equity Studies Equitable? Are State Rankings Meaningful?

Are Pay Equity Studies Equitable?  Are State Rankings meaningful?

The American Association of University Women (AAUW) http://www.aauw.org recently published a state ranking of pay equity for college educated women as compared to men.

The report found that in the United States, the earnings gap between college educated men and women over 25 years of age and who work full-time year round was 71%, meaning these women make 29 cents less on the dollar nationally. They also reported the differences in pay equity by state.

While we do not dispute the numbers as put forth by the study i.e. women typically are paid less than men, we do question the validity of the issue and the reasons typically put forth for its existance.   We believe it presents a one sided argument in favor of legislation supporting the “Paycheck Fairness Act.”  The AAUW supports legislation that would close the gap with legislation.  The study has received significant publicity without some common sense rebuttal.

Why do we question the fairness and validity of this study?

We think many other factors also influence pay.

Should experience matter?  Would it be fair to require people with more experience to be paid the same as those with less experience?

Should training and knowledge matter?  Would it be fair to require pay to be the same for people with less training than others?

We believe training and experience should matter!!

The AAUW study neglects to point out that there are significant differences between men and women in the work place.

The Social Security Administration http://www.socialsecurity.gov reports that women typically work 13 years less than men during their lifetimes.  13 years of less work experience for any person is meaningful.  You would expect those with less work experience regardless of sex to be paid less on average.

Women typically also leave the workforce to raise children.  One study has measured the average time women leave the workforce for child rearing at 11.5 years.  Women work less work years.  This typically also leads to less training and development of computer and other specific job skills that are part of the pay criteria.  Much of this is learned on the job.  It is common sense to expect people with less training and less experience to be paid less.

While we highly respect the important contributions that women make to our world, we do not believe the AAUW study should be considered as an important fact to support pay fairness.  Many women as matter of choice, happily leave the workforce.   We hope for the benefit of fairness that this study and the “Pay Fairness Act” do not become accepted wisdom and law.

The chart below is from the Urban Institute  The Urban Institute recognizes and charts the differences in male/female work experience. Men work significantly more years than women.
Cumulative Distribution of Work Years
The “Best and Worst States for Pay Equity” are listed below.  Read them with caution.  Interestingly we could not find any obvious conclusions from the listings.

The “Best State for Pay Equity” is Vermont.  Nearby New Hampshire is one of the “Worst States for Pay Equity.”  Does this suggest that employers in Vermont are more “fair” to women than in New Hampshire?  Why?

Are employers in Wisconsin or Montana fundamentally more “fair” than nearby poorly ranked Iowa?  Are there factors other than male/female pay discrimination that are more influential that create lower average pay for women in Iowa?  For example, do families in Wisconsin have a lower value for child rearing resulting in more work time for women and thus more pay?  We think that would be a meaningless conclusion.

There are many factors that influence differences in pay between the sexes.  We think state by state rankings offer limited insight and create numerous questions for understanding why.

Best States for Pay Equity

1) Vermont 87%
2) Hawaii 83%
3) Delaware 80%
4) New York 78%
5) Montana 77%
6) Wyoming 77%
7) New Mexico 77%
8) Wisconsin 76%
9) Oregon 76%
10) Nevada 75%

Worst States for Pay Equity


42) Utah 69%
43) Michigan 68%
44) Arkansas 68%
45) Iowa 68%
46) New Hampshire 68%
47) Oklahoma 67%
48) Virginia 67%
49) Mississippi 67%
50) West Virginia 67%
51) Louisiana 65
%

Finally, the AAUW Executive Director Linda D. Hallman, CAE, said “Our analysis is quite disturbing, especially when you consider how more and more families are depending on a woman’s paycheck as the primary source of income in these tough economic times. Consequently, the issue of pay equity takes on an added sense of urgency. This is just one of the reasons why we’re urging the Senate to join the House and pass the Paycheck Fairness Act,”

We disagree.

The “Paycheck Fairness Act” would be unfair if it punishes experience and training. Fairness requires that all people regardless of sex should be paid on the basis of experience and training as well.