No one wants to be unemployed, but recent reports show that certain places in the U.S. are even less conducive to it than others. While we’ve already considered what states have the highest unemployment rates and which ones are tax havens for the unemployed based on a Tax Foundation report, it is now time to look at the other side of the spectrum. Which are the 8 worst states for the unemployed? Using three criteria, Bloomberg ranked the 50 U.S. states and the District of Columbia on the quality of life for the unemployed.
The three criteria considered for ranking were income replacement, or average unemployment benefits (as of 4Q 2012) as a percentage of average state income per capita; unemployment rate (as of March 2013); and wealth disparity, the ratio of households with incomes of at least $200,000 to those with incomes of less than $10,000 (as of 2011 Census ACS). Each state was ranked on the three criteria and the ranks were averaged.
We begin with Alaska. Though it is the 8th worst state for the unemployed, it bears a 6.2 percent unemployment rate that is more than a full percentage point below the national average of 7.5. What are Alaska’s other claims to fame? While it is the 15th worst state for minimum-wage workers, it also boasts the #1 spot for the most female senior workers. Careful inspection of where Alaska falls in the three criteria shows that its income replacement rank is what largely accounts for its status as #8 worst place to live. It bears a relatively low unemployment rate and its average income per capita isn’t significantly lower than the other seven. However, its income rank of #3 is what influences its bad reputation.