Forbes ‘Best States For Business’: See Rhode Island’s Ranking

CRANSTON, RI -- Rhode Island ranks 43rd in the country for business climate, according to a new report from Forbes. The American business magazine published its 13th annual “Best States For Business” rankings Wednesday.

Forbes said the rankings were calculated based on more than 40 metrics spanning six categories: business costs, labor supply, regulatory environment, economic climate, growth prospects and quality of life. Rhode Island fell between Louisiana and Mississippi in Forbes’ overall rankings. Here’s a breakdown:

Business costs

• Rank: 44

Labor supply

• Rank: 30

Regulatory environment

• Rank: 45

Economic climate

• Rank: 36

Growth prospects

• Rank:34

Quality of life

• Rank: 19

Here’s what Forbes had to say about Rhode Island:

"Rhode Island had a net migration out of the state every year from 2005 to 2013. With the seventh worst average unemployment rate over the past five years, residents are leaving the state in search of jobs. Rhode Island had been stuck in the bottom five overall of Forbes Best States for Business for seven straight years before jumping four spots in 2016 thanks to improved scores for its labor supply and economic outlook. Another plus: a high percentage of millennials relative to other New England states who can act as cheap, trainable labor."

The rankings suggest business people ought to consider moving to North Carolina, which topped the list for the second consecutive year. The authors prasied “The Tar Heel State” for its high net migration rate. Many more people have flooded into the state than have exited, the authors said. The state also has one of the smallest number of unionized workers in terms of percent of total employment.

“The resulting benefit is labor costs that are 9 percent below the national average — sixth lowest in the country,” the magazine wrote.

Here are the top 10 states for business:

1. North Carolina
2. Utah
3. Texas
4. Virginia
5. Nebraska
6. Georgia
7. Florida
8. Colorado
9. Minnesota

Two years ago, North Carolina supplanted Utah as the best state for business. Utah had claimed the top spot six times in seven years from 2010-16, but dipped last year due to increasing business costs and weakening economic outlook, Forbes said. But the state remains one of the best due to its business-friendly climate, low energy costs and increasing employment.

On the other hand, Alaska, West Virginia, Maine, Vermont and Hawaii were, respectively, the worst states for business. Alaska’s economy is dependent on oil and gas — which account for more than 80 percent of the state’s revenue — and the drop in oil prices has hurt the state’s economy, Forbes said.

“Alaska's economy shrunk faster than any other state over the past five years (down 2.6 percent per year), and net migration out of the state also ranks worst in the nation,” according to the report.

The state’s employment outlook also ranked dead last over the next half-decade, with Alaska not expected to net any jobs.

Click here to read the methodology.

Patch national staffer Dan Hampton contributed to this report.

Photo credit: Spencer Platt/Getty Images