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Best Places to Make a Living: MoneyRates.com Ranks the Top States

MoneyRates.com Senior Financial Analyst, CFA
June 09, 2014

Best States to Make a Living 2014

Is the job market getting better or worse? It depends on whom you ask -- and where you look.

In its fourth-annual study of the Best and Worst States to Make a Living, MoneyRates.com finds that work-related conditions vary widely among the 50 states. However, recent employment conditions appear to show some consistency: Eight of last year's top 10 states for making a living are in the top 10 again this year.

This study's rankings are based on each state's Compensation and Quality Factor, a proprietary metric based on these factors:

  • Average salary, according to figures from the Bureau of Labor Statistics (BLS).
  • Cost of living, based on data from C2ER.
  • Employment rate, based on BLS data.
  • Workplace conditions, based on the "Work Environment" component of the Gallup-Healthways Well-Being Index.

[Want to earn more interest on the income you set aside for the future? Please see MoneyRates.com savings account and money market account listings to find a higher yield for your savings.]

The 10 best states for working

With the economy still sputtering, millions of Americans are looking for better jobs. If you are one of those people, here are some places you might want to look:

  1. Washington. Washington repeats as the best state for all-round employment conditions, and it held the No. 2 spot in the two years before that. Washington's strengths include one of the highest average incomes in the nation, no state income tax and workplace conditions that ranked in the top 10 in the Gallup-Healthways survey. The state's unemployment rate and cost of living are above average, but only slightly, so this is not enough to undermine its positives.
  2. Texas. Another state with no income tax, Texas moves up from the No. 4 position last year. While the typical income in Texas is only about average, the state benefits from a cost of living and unemployment rate that are both lower than average. Employees in the state indicate that workplace conditions are good enough to rank in the top 10 nationally.
  3. Minnesota. This state moved up three slots from sixth last year, largely on the strength of a very low unemployment rate and excellent workplace conditions. The state does have a higher-than-average cost of living and tax burden, but incomes in the state are more than enough to make up for these disadvantages.
  4. Colorado. The greatest strength Colorado has going for it is a high average income level in a state where the cost of living is about typical of the nation as a whole. Workplace conditions are considered decent, and unemployment is about average. The only clear negative is a state tax burden that is higher than the national norm.
  5. Utah. Like the other states in the top five, Utah repeats a top-10 showing from last year, and this time around it moved up three slots from eighth. Cost of living and unemployment in the state are very low, and workplace conditions are above average. Slightly below-average incomes and above-average tax burdens hold take-home pay down a bit though.
  6. North Dakota. Surging up from 17th, North Dakota benefits tremendously from the nation's lowest unemployment rate, and employees gave the state's workplace conditions the highest rating of any state. Taxes are also very low, which is good because the average income is a little below par.
  7. Virginia. Despite slipping from the No. 2 ranking last year, Virginia deserves recognition for making the top 10 in all four years of this study. Virginia benefits from high incomes, a moderate cost of living and low unemployment. However, the typical tax burden is heavier than average, and employees in Virginia rated workplace conditions a little below the norm.
  8. Nevada. As a state that suffered terribly from the economic downturn, Nevada showed resilience by climbing 10 places in the rankings this year. The unemployment rate, though still a problem, has fallen by more than 5 percentage points over the past four years, and employees give the state's workplace conditions high marks. Incomes are a little below par, but between no state income taxes and a low cost of living, Nevadans come out ahead.
  9. Oklahoma. Up one place from last year, Oklahoma's virtues include a low cost of living, low unemployment and excellent workplace conditions. These help make up for a relatively low average income.
  10. Nebraska. Yet another repeat from last year's top 10, Nebraska earned high honors again, thanks primarily to one of the lowest unemployment rates in the U.S. The cost of living is also very reasonable, and its workplace conditions earned an above-average ranking.

America can still be a land of opportunity, provided you look in the right parts of that land. If you're not happy with the working opportunities in your area, this list might help point you in a better direction.

Didn't see your state on this list or the list of 10 worst states for making a living? Please see the full 50-state rankings.

(An editing error in a previous version of this article wrongly indicated that Virginia was the No. 4 state in 2013.)

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