Massachusetts Is the Most Prosperous State in the U.S.

While the coronavirus pandemic wreaked havoc on most states’ economies, a new report by the Legatum Institute suggests that states with strong economies and other social indicators prior to the pandemic mostly continued to excel afterward.

Massachusetts — which has topped Legatum’s index of most prosperous states almost every year for the past decade — appeared at the top of the London-based think tank’s list again this year. Connecticut and Minnesota retained their respective second and third place posts from 2020 in this year’s index.

New Hampshire, Utah and Vermont took fourth through sixth positions in the 2021 report, compared to fifth, fourth, and seventh places, respectively, in the 2020 index. And this year’s remaining top performing states — Washington, North Dakota, Wisconsin and Colorado — all placed within the top 12 in last year’s report. The District of Columbia ranked fifth overall in the 2021 index.

According to Shaun Flanagan, director of partnerships and impact at Legatum, Massachusetts’ strong performance this year speaks to its staying power near the top of most of the indicators the think tank uses to evaluate states’ prosperity.

“Massachusetts performs well on nearly every single pillar,” he says. “It’s now ranking 35th in terms of the economy quality — that measures how well the economy in the state is equipped to generate wealth sustainably,” which he attributes in part to its high unemployment rate well into 2021.

Legatum evaluates states based on their performance on 11 pillars — safety and security, personal freedom, governance, social capital, business environment, infrastructure, economic quality, living conditions, health, education and natural environment.

“One of the strengths of the index is that you can be improving in one aspect, which is good. But if you’re improving more slowly than other states, you’re going to decrease,” Flanagan says. And of Massachusetts’ performance this year, he points out that other than economic quality, “its (scores are ranked) within (the) top 10 in 11 of the other pillars.”

States in the Southeast, on the other hand, generally tended to score toward the bottom of the prosperity index in both this and previous years’ rankings.

Mississippi ranked at the bottom of the list, in 51st place, preceded by Arkansas, Louisiana, West Virginia and Oklahoma in the remaining bottom four positions. These same states occupied positions 47 through 51 in the 2020 rankings.

Flanagan points out that Mississippi — which was considered the least prosperous state in the 2021 index — “has a fairly weak performing ranking among all pillars. We were working recently with the Mississippi Policy Center, and they’re very keen to look at areas that can be barriers to improvement.”

While the U.S. still ranked highly in the most recent edition of Legatum’s global prosperity index — it placed 18th out of 167 countries — factors including widespread mass shootings and tenuous mental health conditions adversely affected the nation’s standings in Legatum’s safety and security and health indicators.

“When we look at things like mass shootings, over half of the states have seen a mass shooting in every single year since 2014,” Flanagan says. “I think it may be about four that haven’t seen a mass shooting (since then). … Similarly, with mental health, more than half of states have seen a deterioration in terms of mental health before the pandemic.”

On the international scale, Flanagan points out that the usual top performers ( Denmark and Norway in 2020) can be expected to perform well in this year’s edition of the global index. And he says that qualitatively, Massachusetts’ performance domestically places it about on par with Germany (10th place) in the global index, while Mississippi’s is comparable to Portugal (21st place).

“One of the things we talk about in the global report is that there’s almost like a sense of entitlement that the nations have got where they have because of people that have really believed and invested in them,” Flanagan says. “There’s a danger that when you get to a certain level, you take your eye off the ball and stop working as hard as you once did. We notice this in the U.S. as well as here in the U.K. — a polarization of society.

“There needs to be a coming together of society, and building bridges rather than walls,” he continues. “We need to remember who we are.”

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