America's 10 worst states for business in 2017

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Top States for Business

America's 10 worst states for business in 2017

A large 20-foot-deep (6-meter) sinkhole that swallowed two vehicles in North Laurel Canyon Blvd, in Los Angeles, is cordoned-off on February 18, 2017, after a powerful storm hit southern California.
Mark Ralston | AFP | Getty Images

We rank all 50 states in our annual America's Top States for Business study, so if there are going to be top states, there must also be bottom states. We know that every state — regardless of its rank — offers its own unique business advantages. But based on our methodology, these states don't offer the broad appeal that it takes to be a top state. Be sure to check out the full Top States for business ranking to see how your state did. These 10 states bring up the rear this year.

This story has been updated to reflect that New Mexico enjoyed a brief economic boom, thanks to the oil-rich San Juan Basin in the northwest and Permian Basin in the southeast.

  • 10. ARKANSAS

    Let's start with the good news. The Natural State is one of America's least expensive states to live and do business in — a good match for its marquee corporation, "low prices" leader Wal-Mart. The bad news is that you get what you pay for. Arkansas finishes near the bottom in Technology & Innovation and Quality of Life. Its workforce is among America's least educated and least productive.

    Overall score: 1,175 out of 2,500 points
    Worst categories: Technology & Innovation (No. 48), Quality of Life (No. 47)
    Best categories: Cost of Living (No. 4), Cost of Doing Business (No. 7)
    2016 rank: No. 41

    A child touches some Made-in-USA plastic flamingo lawn ornaments at the Walmart Supercenter in Bentonville, Arkansas.
    Rick Wilking | Reuters
  • 9. NEW MEXICO

    This state calls itself the Land of Enchantment, but it appears no one asked businesses to weigh in. The state enjoyed a brief economic boom, thanks to the oil-rich San Juan Basin in the northwest and Permian Basin in the southeast. But then the oil boom deflated, taking crude prices and the New Mexico economy down with it, and leaving the state with a missed opportunity to fix its broken educational system.

    Overall score: 1,110 out of 2,500 points
    Worst categories: Education (No. 45), Business Friendliness (No. 45)
    Best categories: Infrastructure (No. 16), Cost of Doing Business (No. 19)
    2016 rank: No. 39

    A crew member holds a guide line as a hot air balloon is being prepared for take off during the Albuquerque International Balloon Fiesta in Albuquerque, New Mexico.
    Lucas Jackson | Reuters
  • 8. OKLAHOMA

    With the nation's fifth-highest rate of premature death and the fifth-highest rate of uninsured residents, Oklahoma scores poorly in Quality of Life. But that is just the start of its problems. The state also does poorly in Technology & Innovation and Education. The state does offer the nation's fifth-lowest Cost of Living, but remember that bit about getting what you pay for.

    Overall score: 1,105 out of 2,500 points
    Worst categories: Quality of Life (No. 48), Technology & Innovation (No. 44)
    Best categories: Cost of Living (No. 5), Business Friendliness (No. 12)
    2016 rank: No. 42

    Rodeo in Shawnee Oklahoma
    Johnny Haglund | Getty Images
  • 7. LOUISIANA

    Give Louisiana an A for effort — the state aggressively promotes its economic development efforts and offers generous incentives to lower costs. But that grade might mean more if it didn't come from a state with the third-worst education system in the nation. In metric after metric, Louisiana finishes near the bottom, proving that tax breaks and incentives alone are not enough to put a state on top.

    Overall score: 1,054 out of 2,500 points
    Worst categories: Economy (No. 49), Quality of Life (No. 49)
    Best categories: Cost of Doing Business (No. 4), Cost of Living (No. 20)
    2016 rank: No. 44

    Ten years after Hurricane Katrina, New Orleans is both a crowning example of resilience in the face of disaster and a reminder of how decades of broken schools, corruption and inequality crippled the Big Easy, while regional metropolises like Houston and Atlanta grew.
    Derick E. Hingle | Bloomberg | Getty Images
  • 6. RHODE ISLAND

    Hold on a second. Let's put this in perspective. Finishing in 45th place would be nothing to crow about were it not for the fact that this is Rhode Island's best finish since we began rating the states in 2007. Just one year ago the Ocean State finished dead last. The improvement is no accident. Every time we rank Rhode Island at or near the bottom, state officials take it to heart. "Take a fresh look at Rhode Island," Gov. Gina Raimondo urged us last year, pointing to a slate of reforms. Sure enough, Rhode Island's economy notched a solid improvement this year. Other things — like the nation's worst infrastructure — will take more time, but baby steps. Baby steps.

    Overall score: 1,052 out of 2,500 points
    Worst categories: Infrastructure (No. 50), Access to Capital (No. 44)
    Best categories: Education (No. 20), Workforce (No. 27)
    2016 rank: No. 50

    Boats anchored by Newport Bridge in Newport at sunset
    UIG | Getty Images
  • 5. MAINE

    The rugged coast of the Pine Tree State is something to behold. How about a lobster roll? You can get them everywhere. Yes, the quality of life in Maine is wonderful. But does it outweigh one of America's worst business climates? Maine has America's worst workforce, according to our study. By the numbers, Maine workers are unproductive, and low unemployment makes it hard to find good help. The state does finish in the top half for education. But once they get their diplomas, too many Maine graduates choose to leave the state.

    Overall score: 1,046 out of 2,500 points
    Worst categories: Infrastructure (No. 50), Access to Capital (No. 44)
    Best categories: Quality of Life (No. 7), Education (No. 20)
    2016 rank: No. 46

    Nubble Lighthouse in Maine.
    Getty Images
  • 4. ALASKA

    The Last Frontier is searching for a way out of its economic abyss. The state has endured the one-two punch of competition from lower cost shale oil in the Lower 48 followed by lower oil prices in general. Dragged down by a giant budget shortfall thanks to lower oil tax revenue, Alaska's economy is the third worst in the nation by our measure, and the flow of business capital has frozen like an Arctic glacier. If there is a silver lining, it is the fact that there is a ready supply of skilled workers.

    Overall score: 1,033 out of 2,500 points
    Worst categories: Access to Capital (No. 49), Economy (No. 48)
    Best categories: Business Friendliness (No. 20), Quality of Life (No. 22)
    2016 rank: No. 45

    Prudhoe Bay, Alaska.
    Gary Schultz | Getty Images
  • 3. MISSISSIPPI

    The costs of living and doing business in the Magnolia State are the lowest in the nation. Here's what that buys you: the 4th worst economy, the 5th worst workforce, and the 5th worst schools. Long considered downright hostile in its regulatory structure, Mississippi has made strides in Business Friendliness. But it still finishes 43rd in the category. All together, it spells tough times in M-I-S-S-I-S-S-I-P-P-I.

    Overall score: 1,030 out of 2,500 points
    Worst categories: Economy (No. 47), Workforce (No. 46)
    Best categories: Cost of Doing Business (No. 1), Cost of Living (No. 1)
    2016 rank: No. 47

    The popular Ground Zero Blues Club in Clarksdale is owned by Mississippi resident and actor Morgan Freeman.
    John van Hasselt | Corbis | Getty Images
  • 2. HAWAII

    Remember when we said that you get what you pay for? We need to qualify that. The most expensive costs in the nation do buy you the best quality of life, but they don't do much for Hawaii's business climate. Hawaii has one of the lowest-ranked workforces, with a heavy union presence and a limited supply due to low unemployment. While some of Hawaii's disadvantages are beyond its control due to the state's location, others, like the regulatory regime and the roads, are not.

    Overall score: 998 out of 2,500 points
    Worst categories: Cost of Doing Business (No. 50), Cost of Living (No. 50)
    Best categories: Quality of Life (No. 1), Education (No. 30)
    2016 rank: No. 49

    Big wave surfers and a boogie boarder slide down the face of a wave at Waimea Bay in Oahu, Hawaii.
    Getty Images
  • 1. WEST VIRGINIA

    The Mountain State faces a long climb to higher rankings in our study. Its workforce is the least educated in the nation, and its economy is suffering from the painful decline in the coal industry. Compounding both problems: worker retraining programs in West Virginia are somewhat lacking. The cost of doing business is among the lowest in the nation, but with so many problems, businesses are still staying away.

    Overall score: 942 out of 2,500 points
    Worst categories: Economy (No. 50), Workforce (No. 49)
    Best categories: Cost of Doing Business (No. 4), Cost of Living (No. 22)
    2016 rank: No. 47

    Coal miner Dale Travis, 53, of Wheeling, West Virginia, waits for the arrival of U.S. Environmental Protection Agency Administrator Scott Pruitt to visit with miners at the Harvey Mine on April 13, 2017 in Sycamore, Pennsylvania.
    Getty Images