Politics

The Best of Times, the Worst of Times: A Ranking of State Economies

Few of the best- and worst-performing states were in the same position just three years ago.
by | August 22, 2016
A pedestrian stands on a street corner in West Virginia, which has been hard-hit by the decline of the coal mining industry. (AP/David Goldman)

If the 2016 presidential election is all about Donald Trump, the gubernatorial landscape remains, to a large degree, about a more commonplace issue: the economy.

For the first time since 2013, we've ranked the overall economic performance of the 50 states. The results show a connection between a state's economic performance and its governor's approval ratings.

To determine which states are doing well and which aren't, we looked at six variables from the Bureau of Labor Statistics and the Bureau of Economic Analysis: the current state unemployment rate; the improvement in the state unemployment rate over the past year; the per capita state GDP in 2015; the percent change in real state GDP between 2014 and 2015; the percent change in state personal income per capita, from the third quarter of 2015 to the first quarter of 2016; and the percentage growth in year-to-date increases in jobs for 2016.

These variables were chosen to offer a mix of static and dynamic measures of the states' overall economic performance. (See details on our methodology at the end of the story.)

As in the 2013 rankings, we decided to focus on the top and bottom of the list because it's hard to say whether the states in the broad middle have relatively strong or weak economies.

Our results are notable for their degree of flux. Only two of the top 10 states in 2013 -- Oregon and Utah -- repeated on the list in 2016. And only three of the bottom 10 states in 2013 -- Connecticut, Mississippi and New Mexico -- remained in the bottom 10 in 2016.

Also of interest, a majority of the top 10 states are either blue or purple-to-blue on the presidential level, while most of the bottom 10 are red or purple-to-red states. States with favorable economic results the past eight years would presumably be more eager to support Clinton, whereas states with unfavorable economic results would be more hospitable to Trump.

The parties of the governors, meanwhile, don't line up quite as neatly. For instance, two of the presidential blue states in the top 10 have Republican governors -- Massachusetts' Charlie Baker and Maryland's Larry Hogan. The red states of Louisiana and Alaska, which are in the bottom five, respectively have a Democratic governor and an independent governor who ran on a ticket alongside a Democrat.

Here is the full list of states, ranked from strongest to weakest. Duplicate numbers indicate a tie.

1. Massachusetts

2. Oregon

3. Delaware

4. Colorado

5. California

6. Tennessee

7. New Hampshire

8. Utah

9. Virginia

10. Maryland

11. North Carolina

12. Hawaii

13. Florida

14. Idaho

15. Georgia

15. Minnesota

15. Nebraska

15. South Dakota

19. Arkansas

20. Wisconsin

21. Texas

22. Washington

23. Michigan

24. New Jersey

25. Vermont

26. South Carolina

27. Indiana

28. Maine

29. New York

30. Ohio

31. Montana

32. Missouri

33. Nevada

34. Illinois

35. Rhode Island

36. Iowa

37. Kentucky

38. Kansas

39. Pennsylvania

40. North Dakota

41. Arizona

42. Connecticut

43. Alabama

44. Oklahoma

45. Mississippi

46. Louisiana

47. New Mexico

48. Wyoming

49. Alaska

49. West Virginia

How the Rankings Coincide With Governors' Popularity

Once we compiled the state economic rankings, we cross-referenced them with gubernatorial approval ratings to see whether governors of strong economic states were being rewarded by the voters.

In general, they have been.

We used the results of a 50-state series of gubernatorial approval polls conducted by the online publication Morning Consult between January and May 2016. We also spot-checked other gubernatorial approval polls in the past eight months and found them to be generally similar to what Morning Consult found.

The approval ratings for governors of the top 10 states averaged 62.1 percent, while the gubernatorial approval ratings for those in the bottom 10 averaged 50.8 percent. No governor in the top 10 states had an approval rating lower than 54 percent, while six of the governors in the bottom 10 states had approval ratings below 50 percent and one -- Connecticut's Dannel Malloy, a Democrat -- had an approval rating as low as 29 percent.

Here's the list of governors, and their approval ratings, in the top 10 states:

1. Massachusetts Charlie Baker (R) 72 percent
2. Oregon Kate Brown (D) 54 percent
3. Delaware Jack Markell (D) 66 percent
4. Colorado John Hickenlooper (D) 60 percent
5. California Jerry Brown (D) 57 percent
6. Tennessee Bill Haslam (R) 63 percent
7. New Hampshire Maggie Hassan (D) 56 percent
8. Utah Gary Herbert (R) 64 percent
9. Virginia Terry McAuliffe (D) 58 percent
10. Maryland Larry Hogan (R) 71 percent

The governor of the No. 1 state, Baker, is a moderate Republican in Massachusetts, a historically Democratic state.

"Baker has been in office less than two years and is seen as a positive for the state's economy moving forward," said Tufts University political scientist Jeffrey Berry. "The Massachusetts economy is in terrific shape, and it's poised for continued growth."

That said, Berry added, most voters know that the state's positive economy is part of a long-term trend that predates Baker.

"No one sees him as primarily responsible for the high growth rate or low unemployment that we currently enjoy."

Another moderate Republican in a solidly blue state, Hogan of Maryland, is also getting credit for the economy, said Lou Peck, who covers Maryland politics for Bethesda Magazine.

"Hogan is enjoying approval ratings that I find little short of phenomenal given the political complexion of the state," said Peck.

While one factor in his strong ratings is ongoing empathy for Hogan's successful treatment for lymphoma last year, Peck said, "the economy would seem to play into it."

And in Utah, Herbert "receives a lot of credit from voters for the strong economy," said Morgan Lyon Cotti, an adjunct assistant professor at the University of Utah's Hinckley Institute of Politics. "This has always been a major priority for him, and he addresses it in nearly every speech he gives."

Several political experts cautioned that voter sentiment in some of the top 10 states is divided depending on party and ideology.

For instance, in Oregon, which has had Democratic governors since 1987, most residents of the state's prosperous and populous urban and suburban areas are happy with the long run of Democratic leadership, said veteran political columnist David Sarasohn.

By contrast, Sarasohn said, much of rural Oregon has been in recession since the 1980s, when timber tanked, and those voters' identify the poor economy with Democratic governors.

Similar divisions hold in states such as California and New Hampshire, experts said.

As for the list of the bottom 10 states, here are their governors and their approval ratings:

41. Arizona Doug Ducey (R) 49 percent
42. Connecticut Dannel Malloy (D) 29 percent
43. Alabama Robert Bentley (R) 46 percent
44. Oklahoma Mary Fallin (R) 42 percent
45. Mississippi Phil Bryant (R) 60 percent
46. Louisiana John Bel Edwards (D) 45 percent
47. New Mexico Susana Martinez (R) 48 percent
48. Wyoming Matt Mead (R) 67 percent
49. Alaska Bill Walker (I) 62 percent
49. West Virginia Earl Ray Tomblin (D) 60 percent

In Connecticut, where Malloy has the weakest approval rating, residents, "may be divided on Yankees and Red Sox, Giants and Patriots, but they are of one mind on Malloy -- he has been a disaster," said Kevin Rennie, a lawyer and a former Republican state legislator who writes on politics for the Hartford Courant.

Voters in other states, however, are somewhat more forgiving.

In Louisiana, Edwards was only sworn in earlier this year.

"Voters here have a very recent memory of former Gov. Bobby Jindal, who is given much of the blame for the current state of affairs," said Pearson Cross, a political scientist at the University of Louisiana-Lafayette.

Louisiana, like other states on the bottom 10 list, has also been heavily influenced by a decline in the energy sector. In addition to Louisiana, today's bottom 10 includes such energy-dependent states as Alaska, New Mexico, Oklahoma, West Virginia and Wyoming. In fact, two of these states -- Alaska and West Virginia -- actually ranked in the top 10 in 2013, before the full force of the energy decline was felt.

Ironically, voters' understanding of the boom-and-bust patterns in the energy sector may be keeping their governors' approval ratings higher than they would otherwise be, said several experts.

"Most Alaskans recognize that the state's heavy dependence on oil production and tax revenues derived from it means that the fiscal health of the state suffers when production is declining and oil prices are low," said Jerry McBeath, a political scientist at the University of Alaska-Fairbanks. "That's what most would blame for poor economic conditions now."

Methodology

For each of the six variables, we ranked the states from 1 to 50, with 1 being the best score for that variable and 50 the worst score. Once we had the 1 through 50 rankings for all six variables, we added up each state's ranking, double-weighting two of the six measures -- current unemployment and percent change in real GDP -- that we considered the most important. After adding up each state's rankings, including the double-weighted ones, we divided by eight to create an overall average ranking for each state. A rank of 1 in each category would produce an average rating of 1.0, while a rank of 50 would produce an average of 50.0. In reality, no state was perfectly strong or perfectly weak. All states had a mix of rankings, with the rankings for some variables higher than others, so the states' average rankings ranged between 13.3 and 40.6 rather than 1 to 50.

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