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Little Powerhouse on the Prairie

North Dakota, Kansas, and other smaller, rural states have emerged as the economic powerhouses of the U.S., outpacing their larger, urban counterparts. 

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The current recession has turned America’s economy on its head.

High-profile states that led the charge to prosperity earlier in the decade are now among the biggest drags on economic progress. Nevada, Arizona, Florida, California, and Georgia rank among the seven weakest states today, according to a new Portfolio.com/bizjournals analysis.

Small, underpublicized states, on the other hand, are faring remarkably well in these tough times. North Dakota, Louisiana, Oklahoma, South Dakota, Alaska, and West Virginia are among the seven strongest states economically.

Portfolio.com/bizjournals analyzed the recent economic records of all 50 states and the District of Columbia. Each state’s results were compared to corresponding national averages in six categories. Above-average performances received positive scores, while below-average numbers drew negative scores.

The study focused on the following indicators, using raw data from the U.S. Bureau of Labor Statistics, U.S. Bureau of Economic Analysis and Federal Housing Finance Agency:

  • Unemployment rate
  • Nonfarm employment growth
  • Personal income growth
  • Wage growth
  • Home value growth
  • Construction employment growth

Each category was subdivided into five different intervals, all ending in the latest month or quarter for which official figures are available. Nonfarm employment growth, for example, was analyzed over spans ranging from three months (March to June 2009) to three years (June 2006 to June 2009).

North Dakota, with a score of 7.463 points, surprisingly emerged as America’s economic powerhouse, ranking first in the Portfolio.com/bizjournals overall standings. It’s the sole state with an unemployment rate below 5 percent. And it’s the only one with positive growth rates in all five remaining categories during the past 12 months.

Rounding out the top five are Louisiana, Oklahoma, South Dakota, and the District of Columbia. All of these runners-up suffered job losses during the past year, but their income levels are rising (with the exception of South Dakota’s) and their home values are holding steady (with the exception of Washington, D.C.’s)—two solid accomplishments in an uncertain climate.

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