A cable news channel this week released its rankings of the nation’s top states for business, and the results were not kind to Nevada.
The state fell 16 places to No. 45 in this year’s CNBC rankings, which evaluate states based on factors such as infrastructure, education, quality of life, economy and the cost of doing business. The study ranked Nevada 46th overall in 2013 and 29th last year.
“The Silver State offers a ready supply of employees, but the workforce is tarnished by the worst education system in the country,” the report said.
Nevada plummeted in multiple categories from 2014 to 2015:
• From 14th in workforce to a tie for 27th.
• From 19th in infrastructure to a tie for 33rd.
• From 21st in economy to 47th.
• From 35th in technology and innovation to 45th.
• From 15th in access to capital to a tie for 43rd.
States received points based on their rankings in each metric. A point weighting was assigned to each category based on how frequently it is used as a selling point in state economic development marketing materials, CNBC said.
Thus, the study was meant to rank the states based on the criteria they use to sell themselves.
Scott Cohn, a special correspondent for CNBC, said the workforce category played a bigger role in this year’s study because it has been the most widely mentioned selling point for states.
CNBC added metrics in the category, including worker productivity based on economic output per job, states’ investments in workforce development, and net migration of skilled workers in and out of the state, Cohn said.
As a result, there were sizable moves in the workplace category for a number of states, including Nevada.
“Your state does well in several metrics within the category — for example, Nevada is one of the best states at hanging on to its skilled workers,” Cohn said. “Also, the high unemployment rate is a positive in the category because it means there are lots of available workers. However, Nevada’s workforce is one of the least educated in the country, and the state lags the nation on its investment in workforce development.”
On infrastructure, Cohn said Nevada’s bridges are among the nation’s best, but the study found weakness in the drinking-water and wastewater systems based on the anticipated need for repairs.
For the economy category, although the state continues to add jobs at one of the highest rates in the nation, overall economic growth has cooled and lags the national economy, Cohn said. Consumer spending has slowed, and so has the housing market.
“This was the category behind Nevada’s big surge in our rankings in 2014, but it seems to have reversed course to some extent this year,” Cohn said.
Nevada was ranked low in the technology and innovation category because the state is in the bottom tier for research funding in agriculture, health and science, he said. Nevada also ranked 31st for new patents last year.
“Tech business creation seems to have slowed too, possibly because of the sluggish economy,” Cohn said.
As a result, the study found, less business capital flowed into Nevada than a year ago.
The top five states in the rankings were Minnesota, Texas, Utah, Colorado and Georgia. The five states ranked lower than Nevada were Louisiana, Alaska, Rhode Island, West Virginia and Hawaii.
Minnesota ranked second in education and third in quality of life. Hawaii ranked last in cost of living and cost of doing business. It also ranked 49th in infrastructure.
CNBC said it calculated its rankings using input from business and policy experts, government sources, the CNBC Global CFO Council and the states themselves.