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:

Historic Shrink of Government? States May Have No Choice

Smaller government fans may be in for a historic period.  Due to severe budget crises, state governments throughout the U.S. are “cutting budgets” i.e. shrinking in size.  Lack of money is forcing legislators, regardless of party affiliation, to shrink government spending.  In many cases states can not just raise taxes and fees enough to close the gaps.

Georgia, for example, this week, announced its revenue had shrank for the 15th consecutive month.  Revenue for February 2010 is a whopping 41.3% below February 2007.  January was down 27.3% from 2007.  Georgia legislators are faced with figuring out how to run the state on less money.  They will be forced to shrink the size of government.


The Tax Foundation recently highlighted Georgia’s budgetary issues in two releases, “Recession Offers Georgia Opportunity for Tax Reform”  and Georgia Cigarette Tax Hike Would Spur Cross-Border, Black Market Sales

Georgia residents pay the 16th-highest state-local tax burden in the country according to the Tax Foundation.

“There’s just no way to put a pretty face on it,” Lt. Gov. Casey Cagle said in an interview with The Associated Press. “We’ve got to cut this budget and we have to live within our means.”  (Emphasis added)

Georgia Not Alone, All States are Cutting

Georgia is not alone in facing severe cuts.

John Thomasian of the National Governors Association Center for Best Practices outlined the environment and cuts facing state governments in his paper, The Big Reset: State Government after the Great Recession

He writes, “So how must state government adjust to meet the new challenges? Already governors are grappling with this issue. Almost every state has an internal process underway to examine how to cut costs, and several states have created formal task forces or commissions to look at cost- savings and streamlining. Most efforts start by exploring the traditional tools of budget cutting: targeted and across-the-board program cuts, reductions to local aid, layoffs, benefit cuts, furloughs, and salary reductions. In today’s environment, however, states quickly find that these options do not shift the cost curve sufficiently, and they must look at actions that change the way government does business.

Additional steps that are being considered or undertaken today include:

Selling state assets (such as surplus equipment and state office buildings);

Consolidating data centers and IT functions;

Coordinating purchases across agencies;

Consolidating state real estate management into one entity and conducting a review of
real estate holdings and leasing arrangement; and

Reorganizing and combining agencies.”

Profound Changes in State Government

Thomasian writes,  “The current fiscal crisis has spawned a new round of state performance reviews, many of which will yield profound changes in the services state government delivers. This period of government downsizing and streamlining may be a protracted one, ending only when state budget health is restored. The delicate balance will be maintaining those services that help the state prosper, while eliminating those that produce the least value.”  (Emphasis added)

The challenge is that most of our legislators are reluctant to cut government programs.  Segments of the voting community also want their favored programs protected.  We may see a historic shrinking of state government if our legislators and voters reset budgets as circumstances dictate.

Those in favor of smaller government will be tested and have an opportunity to influence this process.

This “reset” of state government will affect all areas of lifestyle including education, jobs and safety. The big question yet to be answered is:  “Will people be happier with a smaller state government that taxes less and provides less services?”

Does Increased Spending on Higher Education lead to Better State University Rankings?

Does Increased Spending on Higher Education lead to Better State University Rankings?

I thought you would find the rankings of state higher education spending and state university rankings useful.  Intuitively one would believe that states that spend more would have better ranked universities. Higher State spending does not mean it is a Best State for Education.  Lower State spending does not mean it is a Worst State for Education.  A closer look is warranted.

Utah spends the most of its state budget on higher education at 15.5%.  Its University of Utah is ranked 126 according to U.S. News 2009 College Ratings. New York spends the least of all states on higher education with only 5.4%  of its budget yet its highest rated public school SUNY-Binghamton is ranked higher than Utah at 80.   North Dakota is a close second in spending at 15.4% and its university’s state ranking in education is Tier III.  Tier III means it is ranked in the 50-75% of all national universities i.e. below average.  7 of the 10 lowest spending states on higher education have higher university rankings than high spending North Dakota.  North Dakota does not get much bang for its buck.

High Spending States on Higher Education and University Rankings

North Carolina is third highest ranked state on higher education spending at 14.2% and has the highest rated public university of the high spending states with a rank of 28.  This appears to be a positive spend to school rank association.  Yet neighboring Georgia with a spend of 7.6% has its Georgia Institute of Technology rated 35.   Georgia Institute of Technology is higher than every high spend state ranking other than North Carolina.

Alaska is the second lowest higher education spending ranked state at 6.1% and appears to get what it pays for. Its school is rated a bottom 25% Tier IV by U.S. News.   Florida is the third lowest state in spend at 6.3% and appears to get very good returns with the University of Florida rated 47, higher than every high spend state other than North Carolina.

States with the lowest spending on higher education
are primarily in the Northeast.  7 of the lowest 10 states are from the Northeast.  They are, in addition to New York, New Jersey, Rhode Island, Massachusetts, Connecticut, Pennsylvania and Maine.  Yet 4 of the states, New Jersey, New York, Pennsylvania and Connecticut have higher ranked schools than every high spend state other than North Carolina.

Low Spending States on Higher Education and University Rankings

Source: Tax Foundation

and US News and World Reports

We have reported previously on education spending and test results.  See Does Spending More on Education Work?

and Graduation Rates, SAT Scores and Educational Spending

A simple thesis that more spending on education leads to better results continues to be elusive.  Be wary of political leaders who say that they are managing your education system better by spending more money.  Check the results.

California Jobs September 2009: Shrinking

California continues to lose jobs.

The California Employment Development Department just released September numbers and California jobs declined by 39,300 during the month.  Unemployment was 12.2% for September, a slight improvement due to an upward revision of August to 12.3%

More unemployment is not a surprise considering all the problems the state has.  (See Why California is a Worst State for Jobs)


The Bureau of Labor Statisticsis is scheduled to release the nation’s September List of State Unemployment on Wednesday October 20.  August was bad news.  (See August 2009 Best and Worst States for Employment) California’s release on Friday is a preview of more state releases to come next week.

September should show more State Employment decreases as the September US Unemployment rate increased to 9.8% from 9.7%.

The LA Times ran a story California Job Losses Keep Climbing on Friday as well about the outlook for California Jobs.  Los Angeles County’s unemployment rate soared to 12.7% in September, upfrom 12.2% in August. Industries including leisure and hospitality,manufacturing and construction shed jobs over the month.  The Bay Area saw its unemployment rate decrease from August. The jobless rates in Napa County, at 8.7%,and the San Francisco-San Mateo-Redwood City Metro Division, at 9.2%,are among the lowest in the state. All five metro divisions in the Bay Area improved. California Jobs do not look like they will be improving significantly soon.  See also California Job Openings September 2009

The September 2009 California Employment by County List follows:

County Labor Force Employed Jobless Jobless %
ALAMEDA 768,700 681,500 87,200 11.30%
ALPINE 420 350 60 15.20%
AMADOR 17,960 15,790 2,170 12.10%
BUTTE 105,400 92,600 12,800 12.20%
CALAVERAS 21,000 18,000 3,000 14.30%
COLUSA 11,160 9,540 1,620 14.50%
CONTRA COSTA 529,900 470,400 59,400 11.20%
DEL NORTE 11,870 10,460 1,410 11.90%
EL DORADO 91,200 81,000 10,200 11.20%
FRESNO 452,200 388,600 63,500 14.10%
GLENN 12,590 10,860 1,730 13.80%
HUMBOLDT 60,000 53,800 6,200 10.30%
IMPERIAL 76,900 53,700 23,200 30.10%
INYO 8,980 8,120 860 9.50%
KERN 377,400 325,100 52,300 13.90%
KINGS 59,700 51,400 8,300 13.90%
LAKE 25,890 22,080 3,800 14.70%
LASSEN 13,510 11,910 1,600 11.80%
LOS ANGELES 4,923,800 4,298,200 625,700 12.70%
MADERA 70,400 61,700 8,700 12.30%
MARIN 134,600 123,900 10,700 8.00%
MARIPOSA 9,980 9,100 880 8.80%
MENDOCINO 43,420 39,040 4,390 10.10%
MERCED 106,700 89,900 16,700 15.70%
MODOC 4,050 3,600 450 11.10%
MONO 7,880 7,070 810 10.30%
MONTEREY 217,000 195,400 21,700 10.00%
NAPA 75,600 69,100 6,500 8.70%
NEVADA 49,730 44,290 5,440 10.90%
ORANGE 1,624,900 1,472,400 152,500 9.40%
PLACER 175,100 155,300 19,800 11.30%
PLUMAS 10,210 8,790 1,420 13.90%
RIVERSIDE 915,600 780,800 134,800 14.70%
SACRAMENTO 687,900 604,200 83,700 12.20%
SAN BENITO 24,800 21,700 3,100 12.50%
SAN BERNARDINO 867,500 749,700 117,800 13.60%
SAN DIEGO 1,560,000 1,400,200 159,800 10.20%
SAN FRANCISCO 447,100 403,700 43,400 9.70%
SAN JOAQUIN 304,600 257,400 47,100 15.50%
SAN LUIS OBISPO 138,400 125,900 12,500 9.00%
SAN MATEO 380,800 346,400 34,400 9.00%
SANTA BARBARA 221,600 202,700 18,800 8.50%
SANTA CLARA 886,600 782,200 104,400 11.80%
SANTA CRUZ 147,900 132,800 15,100 10.20%
SHASTA 84,000 71,600 12,300 14.70%
SIERRA 1,540 1,330 210 13.70%
SISKIYOU 18,870 16,320 2,550 13.50%
SOLANO 214,400 189,700 24,700 11.50%
SONOMA 262,400 236,400 26,000 9.90%
STANISLAUS 243,200 206,000 37,200 15.30%
SUTTER 41,600 35,300 6,300 15.10%
TEHAMA 26,220 22,630 3,590 13.70%
TRINITY 4,700 3,950 750 15.90%
TULARE 206,300 175,600 30,700 14.90%
TUOLUMNE 25,900 22,610 3,300 12.70%
VENTURA 428,800 381,600 47,200 11.00%
YOLO 97,500 86,900 10,600 10.90%
YUBA 28,800 23,700 5,100 17.80%