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America’s worst states for business in 2016

A scorecard on state economies

Paul J. Richards | AFP | Getty Images

There's no way around it. In order to determine our Top States for Business each year, we have to put all 50 states to the same test. That means scoring them on more than 60 metrics in 10 categories of competitiveness under our tried-and-true methodology. And since we score every state, our Top States study also reveals America's Bottom States for Business.

For 2016, these 10 states bring up the rear.

10. Arkansas

Jake Rajs | Getty Images

The Natural State is decidedly lacking in some of the best things in nature — like fresh air. Air quality here is among the worst in the nation. Some more natural food might help in a state with one of the country's worst obesity rates. Arkansas doesn't just suffer from poor quality of life; scientific research funding tends to bypass the state, which comes in near the bottom for Technology & Innovation. But Cost of Living is among the most affordable in the nation.

Overall score: 1,129 out of 2,500 points
Best category: Cost of Living (No. 3)
Worst categories: Quality of Life (No. 50), Technology & Innovation (No. 47)
2015 Top States rank: No. 32

9. Oklahoma

A motorist fills her car with gas at a gas station near an oil field pumping rig in Oklahoma City, Oklahoma.
Getty Images

Residents of the Sooner State could stand to get back to the gym a little sooner. Poor health contributes to a low Quality of Life ranking. Oklahoma is among several states impacted by falling oil prices, which dealt a body blow to the state's Economy ranking — it falls 30 places from a year ago. Moody's has placed a negative outlook on the state's debt, warning that state budget reserves could be under stress for at least another year as the oil shock plays out.

Overall score: 1,122 out of 2,500 points
Best category: Cost of Living (No. 6)
Worst categories: Quality of Life (No. 48), Economy (No. 44)
2015 Top States rank: No. 31

8. Connecticut

Daytime scene of traffic on the 'Merritt Parkway' in Connecticut during winter. The Merritt Parkway is a historic limited-access parkway in Fairfield County, Connecticut and it was named after the U.S. Congressman Schuyler Merritt.
Carmine Salvatore | Getty Images

In the Constitution State, the constitution of the roads and bridges leaves much to be desired, contributing to one of the worst Infrastructure rankings. Worker productivity, based on economic output per job — which had been a strong point for Connecticut because of the state's reliance on the high-output finance and insurance industries — has cooled somewhat, hurting the state's Workforce ranking. The result: Connecticut is one of the most expensive states for business, with less to show this year for all that money spent.

Overall score: 1,100 out of 2,500 points
Best categories: Workforce (No. 18), Education (No. 18)
Worst categories: Cost of Doing Business (No. 47), Infrastructure (No. 47)
2015 Top States rank: No. 33

7. Louisiana

A local man is being arrested by NOPD on Bourbon street in New Orleans, Louisiana.
Alpeyrie | ullstein bild | Getty Images

Like so many of its Gulf Coast neighbors, the Pelican State is hobbled by low prices. But the state's Economy ranking also suffers from a state budget crisis made worse by incentives meant to attract business. Louisiana suffers persistent Quality of Life issues because of poor health and a high crime rate. The state does rank high in Cost of Doing Business, due to its cheap electricity, low wages and the same incentives that are hurting the state budget — proof that competitiveness is often a trade-off.

Overall score: 1,098 out of 2,500 points
Best category: Cost of Doing Business (No. 7)
Worst categories: Quality of Life (No. 47), Economy (No. 46), Technology & Innovation (No. 46)
2015 Top States rank: No. 46

6. Alaska

Patrick J. Endres | Getty Images

The Last Frontier is on a quest for answers to a wrenching budget crisis due to the plunging price of oil. The legislature is grappling over proposals to retool the state's sovereign wealth fund — the source of annual dividends for every man, woman and child in the state — using some of the money to shore up the budget. All of that hurts the state's Economy ranking. And with costs among the highest of any state, Alaska is a less-than-hospitable environment for business.

Overall score: 1,047 out of 2,500 points
Best category: Quality of Life (No. 20)
Worst categories: Cost of Living (No. 45), Cost of Doing Business (No. 41), Economy (No. 41), Technology & Innovation (No. 41)
2015 Top States rank: No. 47

5. Maine

Construction crew working along the Maine Turnpike in Falmouth.
John Patriquin | Portland Press Herald | Getty Images

The Pine Tree State is shedding points in the crucial Workforce category. For a second year in a row, Maine workers are the nation's least productive in terms of economic output per job. A brain drain that had workers leaving the state in droves last year has slowed a bit as the employment picture improved, but that is also hurting the state somewhat. Low unemployment means the supply of workers, already tight in Maine to begin with, is even tighter now. Combine that with one of the worst infrastructures of any state, and this northern state's ranking is headed south in a big way.

Overall score: 1,027 out of 2,500 points
Best category: Quality of Life (No. 5)
Worst categories: Workforce (No. 50), Economy (No. 49)
2015 Top States rank: No. 44

4. (Tie) Mississippi

A homeless man in Biloxi, Mississippi. According to the latest US Census Bureau data, Mississippi is the nation's poorest state, with a median income of $41,754. The city of Biloxi has struggled to make progress after the devastating flooding from Hurricane Katrina in 2005.
Getty Images

While the Magnolia State offers the lowest Cost of Living and the third-lowest Cost of Doing business, it unfortunately appears that you get what you pay for. We find Mississippi has the nation's worst economy after two years of subpar economic growth — an issue plaguing most of the Gulf Coast because of the low price of oil. The state's poor Quality of Life ranking slipped further this year: Mississippi is one of America's unhealthiest and least inclusive states.

Overall score: 1,024 out of 2,500 points
Best category: Cost of Living (No. 1)
Worst categories: Economy (No. 50), Technology & Innovation (No. 50)
2015 Top States rank: No. 43

4. (Tie) West Virginia

A bulldozer moves coal that will be burned to generate electricity at the American Electric Power Co. Inc. coal-fired John E. Amos Power Plant in Winfield, West Virginia.
Luke Sharrett | Bloomberg | Getty Images

The Mountain State workforce is poorly educated and heavily unionized — instant turnoffs for business. The sorry state of the coal industry has left the West Virginia economy in shambles, and the state has a terrible reputation for business friendliness, which is keeping Access to Capital low. The state does well on costs, but not as well as some. State incentives and some utility costs hurt an otherwise affordable state's Cost of Doing Business ranking.

Overall score: 1,024 out of 2,500 points
Best category: Cost of Doing Business (No. 11)
Worst categories: Technology & Innovation (No. 49), Access to Capital (No. 48)
2015 Top States rank: No. 49

2. Hawaii

Hanalei Bridge in Kauai, Hawaii.
Keven Osborne | Getty Images

The Aloha State may have too many built-in disadvantages to ever be a Top State, but not all of the problems are beyond Hawaii's control. For example, the state is automatically penalized in our Infrastructure category for having no railroads, even though there is no reason why a Pacific Island chain would need them. But geography is no excuse for 43 percent of the state's bridges being rated deficient, or the state's high union membership or the state's paltry business incentives. Hawaii does offer the top-ranked Quality of Life, but you will pay for it with the highest costs of any state.

Overall score: 1,009 out of 2,500 points
Best category: Quality of Life (No. 1)
Worst categories: Cost of Doing Business (No. 50), Cost of Living (No. 50)
2015 Top States rank: No. 50

1. Rhode Island

The Rose Island Lighthouse in Narragansett Bay.
Jonathan Wiggs | The Boston Globe | Getty Images

The Ocean State has a dismal record in our study over the years, and only some of it has to do with the state's built-in disadvantage of being small — something we adjust for anyway in many metrics by using per capita figures. Rhode Island is one of America's most expensive states. And while you might think that Rhode Island's diminutive size would make it easier for the state to maintain its infrastructure, that is not the case. More than half of the state's 766 bridges are deficient. The little state has some big plans to change, but they don't help this year — which is Rhode Island's fourth time in 10 years at the bottom of our rankings.

Overall score: 981 out of 2,500 points
Best category: Education (No. 20)
Worst categories: Infrastructure (No. 50), Cost of Doing Business (No. 45), Economy (No. 45), Access to Capital (No. 45)
2015 Top States rank: No. 48