Worst States to Make a Living 2012

by Richard Barrington Senior Financial Analyst, CFA www.MoneyRates.com

You probably know that there are plenty of challenges to making a living in today's economy. What you may not know is how significantly the place you live can impact some of those challenges.

According to the Bureau of Labor Statistics, average wages range from a low of $33,930 in Mississippi to a high of $53,700 in Massachusetts. Unemployment rates range from a low of 3.3 percent in North Dakota, to a high of 12.6 percent in Nevada. Tax rates and cost of living also vary greatly by state. So are some states really better for making a living than others?

For the second year in a row, MoneyRates.com has calculated a list of the best and worst states to make a living. The process factors in each state's average income, state tax rate, cost of living and unemployment rate to create an adjusted average income figure that serves as the basis for these rankings.

In a separate article, you can find the 10 best states to make a living in 2012. Here, though, are MoneyRates.com's 10 worst states to make a living for 2012:

1. Hawaii (Adjusted average income: $22,394)

There are plenty of lifestyle perks to living in a warm climate with beautiful scenery, but financially it can be tough going. Hawaii repeats from last year as the toughest place to make a living, and it isn't even close to losing the spot. At $22,394, Hawaii's adjusted average income figure is more than $7,000 below that of the next lowest state. The primary problem is that while incomes in Hawaii are about the national average, the cost of living in the state is far and away the highest in the nation.

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50 States Ranked 

These rankings are determined by an adjusted average income figure for each state, a number that factors together the four variables above to determine each state's relative standing for career-related conditions.

Here are the rankings of all 50 states, complete with each state's adjusted average income figure:

1. Virginia $43,677

2. Washington $43,662

3. Texas $42,816

4. Illinois $41,865

5. Colorado $40,490

6. Michigan $40,421

7. Wyoming $39,745

8. Utah $39,250

9. Delaware $38,802

10. Massachusetts $38,793

11. Tennessee $38,700

12. Minnesota $38,571

13. Ohio $38,364

14. Georgia $37,930

15. Pennsylvania $37,858

16. Indiana $37,181

17. Florida $37,145

18. Nevada $37,078

19. Kansas $37,008

20. Missouri $36,919

21. Nebraska $36,882

22. Wisconsin $36,588

23. Maryland $36,416

24. Arizona $36,314

25. Oklahoma $36,251

26. Alabama $36,205

27. New Mexico $35,813

28. Louisiana $35,727

29. North Dakota $35,642

30. Kentucky $35,520

31. Idaho $35,192

32. New Hampshire $35,173

33. North Carolina $35,064

34. Alaska $34,914

35. Iowa $34,845

36. New York $34,074

37. Connecticut $34,017

38. Oregon $33,788

39. Arkansas $33,763

40. New Jersey $33,623

41. South Dakota $33,121

42. South Carolina $32,645

43. West Virginia $32,297

44. California $31,459

45. Rhode Island $31,353

46. Montana $31,256

47. Mississippi $31,178

48. Vermont $30,433

49. Maine $29,703

50. Hawaii $22,394

To see how the states have shifted in the last year, see the 2011 50-state rankings.