Special Report

The Best (and Worst) States to Be Unemployed

Evan Comen, Michael B. Sauter

Published: June 7, 2016 5:52 am

Last Updated: January 13, 2020 7:08 am

Unemployment in the United States has steadily improved over the past six and a half years. The unemployment rate today is half its mid-recession peak, and non-farm payroll employment has increased for more than 60 straight months.

Despite the lower unemployment rate, millions of Americans still continue to search for work without luck. To support themselves and their families, many apply for unemployment insurance while they remain out of work.

Unemployment is far from an ideal situation, but the prospects for out-of-work residents depend a great deal on where they live. In North Dakota, which has a very healthy job market, nearly 75% of the jobless workforce receives benefits — at an average of $520.64 weekly. In Louisiana, where work is generally harder to come by, just 13.5% of the unemployed population receives benefits — at an average of $217.64 weekly.

Click here to see the best states to be unemployed.

Click here to see the worst states to be unemployed.

Based on employment growth, unemployment rates, the proportion of jobless residents receiving UI benefits, and the average weekly UI payment, 24/7 Wall St. reviewed the best and worst states to be unemployed.

In no state does the entire unemployed population receive unemployment insurance. A state’s recipiency rate, or share of the unemployed population receiving UI benefits, depends on a number of factors and varies greatly from state to state. In Florida, the recipiency rate is just 10.2%, while in North Dakota it is 74.0%, the highest share.

Recipiency depends on a number of factors, such as the state’s UI eligibility requirements, state and federal funding, and the public’s awareness about UI programs. In an interview with 24/7 Wall St., Claire McKenna, senior policy analyst at the National Employment Law Project, explained that more restrictive UI programs tend to have fewer unemployed residents who receive benefits. “In states that have reduced benefit amounts and duration and that have restricted eligibility, we have seen reductions in recipiency,” she said.

States determine the amount a worker receives in benefits based on a proportion of the wages earned at his or her last job. The higher the lost wages, the higher the stipend. However, states also set a maximum amount for how much can be doled out on a weekly basis, ranging from $679 in Massachusetts to just $221 in Louisiana, the highest and lowest benefit amounts respectively. The maximum set in each state appears to also have a direct impact on the average benefit amount. All 10 of states with the lowest average weekly payments also have among the lowest maximum weekly benefits set.

For those who are unemployed, just as important as the benefits are the chances of finding a job before benefits run out. While not a perfect measure, the unemployment rate can be a rough indication of these chances. In states with higher unemployment rates, job seekers will likely have a harder time finding work. The same is true in states where employment is declining meaningfully. On the other hand, in states with low unemployment and healthy job growth, the prospects are likely better for the unemployed.

Many of the worst states to be unemployed in today made drastic cuts to their UI schemes in the aftermath of the Great Recession. Since 2011, a number states have cut the maximum durations people can receive unemployment benefits. North Carolina, for example, reduced the maximum number of weeks a recipient could stay on UI from 26 to just 13 weeks. “A number of states favored benefit reductions and eligibility restrictions at the expense of sensible financing reforms,” McKenna said. As a result, in every state that cut benefits availability by more than one week the recipiency rate declined significantly.

To identify the best (and worst) states to be unemployed, 24/7 Wall St. generated a rank comprised of four measures: the most recent unemployment rate, the unemployment insurance recipiency rate, the average weekly benefit amount as a percentage of the average weekly wage in the state, and the one-year job growth rate. Unemployment rates, non-farm payroll employment figures, and the average duration of unemployment came from the Bureau of Labor Statistics. The recipiency rate, the proportion of recipients who exhaust their benefits before leaving UI recipiency, average weekly benefits, average benefits duration, initial claims to receive benefits, and total recipients came from the U.S. Department of Labor. Average weekly wages, used to calculate the replacement rate — the average share of UI recipient lost wages covered by benefits — came from the BLS. All data are for the most recent period available.

These are the best (and worst) states to be unemployed.

10. Oregon
>Pct. unemployed getting benefits: 30.4% (19th highest)
> Pct. average weekly wage covered: 40.1% (15th highest)
> Unemployment rate: 4.5% (24th lowest)
> 1-yr. job growth: 3.5% (3rd highest)

Because of Oregon’s strengthening job market many jobless residents are employed today. The 3.5% growth in total non-farm employment in the state over the past year was the third most of any state. Also, Oregon’s 1.2 percentage point decline in the unemployment rate was among the largest improvements in the country. For those on unemployment insurance, the benefits are relatively extensive. Average weekly UI payments account for 40.1% of the state’s average weekly wage, more than the 33.9% national replacement rate.

9. Montana
>Pct. unemployed getting benefits: 40.0% (7th highest)
> Pct. average weekly wage covered: 42.9% (8th highest)
> Unemployment rate: 4.2% (18th lowest)
> 1-yr. job growth: 1.3% (15th lowest)

The Montana Department of Labor and Industry offers some of the most comprehensive UI benefits in the country. The department insures two in every five unemployed residents, the seventh highest recipiency rate of any state. Also, the average UI payment covers 42.9% of the state’s average weekly wage, the eighth highest replacement rate nationwide. Montana has been able to maintain wide UI coverage despite increasing unemployment in the state. Over the past 12 months, while the national unemployment rate declined by 0.4 percentage points, Montana’s unemployment rate rose by 0.2 percentage points.

8. Iowa
>Pct. unemployed getting benefits: 39.7% (8th highest)
> Pct. average weekly wage covered: 45.6% (3rd highest)
> Unemployment rate: 3.9% (15th lowest)
> 1-yr. job growth: 1.3% (16th lowest)

For those unemployed in Iowa, the state offers some of the most comprehensive UI benefits in the country. The average UI payment covers 45.6% of Iowa’s average weekly wage, the third highest replacement rate nationwide. Also, just about one in four UI recipients exhaust their entire 26 weeks of allotted benefits before going off insurance, the sixth lowest exhaustion rate.

7. Idaho
>Pct. unemployed getting benefits: 25.3% (21st lowest)
> Pct. average weekly wage covered: 41.5% (10th highest)
> Unemployment rate: 3.7% (10th lowest)
> 1-yr. job growth: 3.8% (the highest)

No state had greater job growth than Idaho over the past 12 months. Employment grew by 3.8%, twice the 1.9% national job growth rate. At the same time, the state’s unemployment rate dropped 0.5 percentage points to 3.7%, one of the lowest in the country.

The average UI payment in Idaho accounts for 41.5% of the state’s average weekly wage, more substantial substitution than the the national 33.9% replacement rate. Idaho’s UI program services just 25.3% of the state’s unemployed, however, somewhat modest coverage compared to the national 27.3% recipiency rate.

6. Colorado
>Pct. unemployed getting benefits: 31.7% (18th highest)
> Pct. average weekly wage covered: 39.7% (17th highest)
> Unemployment rate: 3.1% (4th lowest)
> 1-yr. job growth: 2.7% (11th highest)

Compared to most states with a highly positive outlook for unemployed residents, Colorado has an unusually high unemployment benefit exhaustion rate. More than 45% of Colorado residents are likely to go through the maximum 26 weeks without getting another job. Only five other states have an exhaustion rate greater than 45%.

Still, for many other reasons, it is better to be without a job in Colorado than in most other states. UI benefits pay an average of $402.47 weekly, the seventh highest average amount in the country. The state also has one of the lowest unemployment rates and one of the fastest job growth rates, which means the state’s jobless have a higher chance finding a job.

5. Utah
>Pct. unemployed getting benefits: 22.8% (18th lowest)
> Pct. average weekly wage covered: 45.2% (4th highest)
> Unemployment rate: 3.7% (10th lowest)
> 1-yr. job growth: 3.4% (4th highest)

The average weekly UI benefits in Utah account for 45.2% of the state’s average weekly wage, the fourth highest replacement rate in the country. While Utah’s UI recipients can receive benefits for a maximum of 26 weeks, the average recipient is on UI for just 12.1 weeks, nearly the shortest duration of any state. Likewise, only 27.6% of recipients remain on UI for the entire 26 weeks compared to the 37.6% national exhaustion rate.

Utah has one of the fastest growing job markets in the country, adding about 47,000 employees in the last year. While the 3.4% job growth was the fourth fastest of any state, Utah’s unemployment rate rose by 0.2 percentage points even as the national unemployment rate fell by 0.4 percentage points. Nevertheless, even as the state’s unemployed population grew, Utah managed to maintain its 23% UI recipiency rate.

4. Vermont
>Pct. unemployed getting benefits: 39.4% (9th highest)
> Pct. average weekly wage covered: 40.1% (16th highest)
> Unemployment rate: 3.2% (tied- 7th lowest)
> 1-yr. job growth: 1.9% (21st highest)

Nationally, 37.6% of people who go on unemployment insurance receive benefits for the entire allotted time. In Vermont, just 16.5% of people on UI exhaust their 26 weeks of benefits, the second lowest rate in the country behind only South Dakota. The low exhaustion rate is unsurprising given the state’s relatively low unemployment rate. Just 3.2% of the state’s workforce is unemployed, tied for the fifth lowest jobless rate in the country. Likely due to the state’s favorable employment situation, the number of people applying for unemployment insurance benefits declined substantially last year.

3. Minnesota
>Pct. unemployed getting benefits: 47.8% (4th highest)
> Pct. average weekly wage covered: 42.8% (9th highest)
> Unemployment rate: 3.8% (12th lowest)
> 1-yr. job growth: 1.4% (22nd lowest)

Minnesota’s UI program allows for beneficiaries to receive a weekly maximum of $629 for a maximum of 26 weeks, each among the most of any state. The average payment accounts for 42.8% of the state’s average weekly wage, much more than the 33.9% national replacement rate. Minnesota’s UI program is comprehensive in both subsidy and coverage. Of the state’s unemployed residents, 47.8% receive unemployment insurance, the fourth highest recipiency rate nationwide.

2. North Dakota
>Pct. unemployed getting benefits: 74.0% (the highest)
> Pct. average weekly wage covered: 53.2% (the highest)
> Unemployment rate: 3.2% (tied- 7th lowest)
> 1-yr. job growth: -3.8% (the lowest)

North Dakota’s recent oil boom has begun to flag due to continuing depressed oil prices. While the state’s unemployment rate is still relatively low, the number of North Dakotans submitting claims for unemployment insurance increased by 37.4% last year, by far the largest increase in applications of any state.

Those residents newly receiving UI benefits are likely to fare better than those in nearly any other state. The state pays out an average of $520.64 each week, or 53.2% of the the average weekly wage, both the highest in the country.

1. Hawaii
>Pct. unemployed getting benefits: 32.6% (16th highest)
> Pct. average weekly wage covered: 50.8% (2nd highest)
> Unemployment rate: 3.2% (tied- 7th lowest)
> 1-yr. job growth: 2.0% (20th highest)

In the past 12 months, Hawaii’s unemployment rate fell by 0.6 percentage points to 3.2%, tied as the fifth lowest of any state. Since then, there have been 21.5% fewer unemployment claims in the state, the fifth largest drop nationwide.

Hawaii is one of two states in which the average UI payment covers more than half of the state’s average weekly wage. The substantial subsidy helps Hawaii’s unemployed as they attempt to reenter the job market. Just 27.8% of recipients exhaust their benefits, much less than the 37.6% national exhaustion rate.

10. West Virginia
>Pct. unemployed getting benefits: 36.2% (12th highest)
> Pct. average weekly wage covered: 39.0% (20th highest)
> Unemployment rate: 6.4% (3rd highest)
> 1-yr. job growth: -0.6% (4th lowest)

West Virginia has one of the weakest labor markets in the country, with the third highest unemployment rate of 6.4%. Further, the number of jobs in the state has declined by 0.6%, a greater decline than in all but three states. Those who are unemployed in West Virginia face competition from other jobseekers and likely have fewer positions to choose from.

9. New Mexico
>Pct. unemployed getting benefits: 20.9% (15th lowest)
> Pct. average weekly wage covered: 41.1% (12th highest)
> Unemployment rate: 6.2% (5th highest)
> 1-yr. job growth: 0.2% (8th lowest)

Those who find themselves unemployed in New Mexico are much less likely to find a job than those in most other states. The number of jobs in the state increased by just 0.2% over the past year, less than in the vast majority of states. The state’s current unemployment rate of 6.2% is the fifth highest in the country. New Mexico has the typical 26 weeks maximum benefits, but the maximum payout is barely over $400 — lower than in the majority of states. Only slightly more than one in five jobless residents are currently receiving unemployment insurance. The state recently implemented a new system to target and reduce UI claim fraud, and the state’s Department of Workforce Solutions claims the program has been largely successful.

8. South Carolina
>Pct. unemployed getting benefits: 13.7% (6th lowest)
> Pct. average weekly wage covered: 32.0% (19th lowest)
> Unemployment rate: 5.8% (8th highest)
> 1-yr. job growth: 2.7% (12th highest)

South Carolina was one of a handful of states to reduce UI benefits in aftermath of the Great Recession, cutting the maximum availability of payments from 26 to 20 weeks. Partially as a result, South Carolina’s recipiency rate fell 2.3 times as quickly as the country’s as a whole.

Today, South Carolina’s UI program serves just 13.7% of the state’s unemployed population, the sixth lowest recipiency rate nationwide. The average beneficiary receives UI payments for only 11 weeks, a shorter duration than in any state other than Georgia. Despite declining since the recession, South Carolina’s 5.8% unemployment rate is still one of the highest in the country.

7. Arizona
>Pct. unemployed getting benefits: 14.4% (9th lowest)
> Pct. average weekly wage covered: 24.8% (the lowest)
> Unemployment rate: 5.5% (12th highest)
> 1-yr. job growth: 3.1% (8th highest)

Arizona has one of the higher unemployment rates in the United States. However, the number of jobs in the state has increased by 3.1% in the past year, a sign that the unemployed may be starting to find work. Still, those who are unemployed are unlikely to be compensated well — if they are receiving benefits at all. Just 14.4% of Arizona’s unemployed receive UI benefits compared to a national recipiency rate of 27.3%. The maximum weekly benefits a state resident can receive is just $240, less than in all but two states. The average payout of $224.14 amounts to less than one-quarter of the average Arizona weekly wage, the worst replacement rate in the country.

6. Illinois
>Pct. unemployed getting benefits: 29.0% (23rd highest)
> Pct. average weekly wage covered: 33.1% (21st lowest)
> Unemployment rate: 6.6% (tied- the highest)
> 1-yr. job growth: 1.1% (13th lowest)

Those seeking work in Illinois face one of the toughest job markets in the country. Over the past year, the state’s unemployment rate rose by 0.7 percentage points, while the national unemployment rate fell by 0.4 percentage points. Today, the state’s 6.6% unemployment rate is tied with Alaska as the highest in the country..

For those receiving UI benefits in Illinois, payments are somewhat modest. The average UI payment accounts for 33.1% of the state’s average weekly earnings, a replacement rate slightly below the 33.9% national figure.

5. North Carolina
>Pct. unemployed getting benefits: 11.4% (2nd lowest)
> Pct. average weekly wage covered: 28.1% (10th lowest)
> Unemployment rate: 5.4% (15th highest)
> 1-yr. job growth: 2.3% (15th highest)

The North Carolina legislature enacted in 2013 a law that prematurely cut all funding from the federal Emergency Unemployment Compensation program — which provided benefits to individuals that had exhausted their regular state benefits — before the program was set to expire. As a result, an estimated 170,000 unemployed residents lost their UI benefits by the second half of the year. The bill also cut the amount many claimants can receive and established more restrictive UI eligibility rules.

Today, just 11.4% of unemployed North Carolinians receive UI benefits, the second lowest recipiency rate nationwide. For the minority of jobless residents who receive benefits, the average payment covers just 28.1% of the state’s average weekly earnings, one of the lower replacement rates in the country.

4. Alaska
>Pct. unemployed getting benefits: 50.6% (2nd highest)
> Pct. average weekly wage covered: 26.5% (6th lowest)
> Unemployment rate: 6.6% (tied- the highest)
> 1-yr. job growth: -1.0% (3rd lowest)

Alaska’s unemployment benefits program is not as unfavorable as many of the worst states to be unemployed. More than half of the state’s unemployed are currently receiving benefits, the second highest recipiency rate in the country. The maximum weekly UI payout of $370 is worse than the majority of states but still higher than 13 states. The greatest negative for the state’s unemployed population is the difficult job environment Alaskans face. The state’s unemployment rate of 6.6% is tied with Illinois for the highest in the country. In the past 12 months, as the number of U.S. jobs increased by 1.9%, the number of Alaskan jobs declined by 1.0%, worse than in all but two other states. In both 2014 and 2015, Alaska meaningfully reduced the taxes intended to fund unemployment insurance in the state.

3. Mississippi
>Pct. unemployed getting benefits: 13.1% (3rd lowest)
> Pct. average weekly wage covered: 28.8% (11th lowest)
> Unemployment rate: 6.0% (7th highest)
> 1-yr. job growth: 1.4% (21st lowest)

Mississippi residents seeking work face one of the harshest job markets in the country. Despite falling by 0.5 percentage points in the past year, the state’s 6.0% unemployment rate is the seventh highest nationwide.

Only 13.1% of Mississippi’s unemployed receive UI benefits, the third lowest recipiency rate in the country. For the few who receive unemployment insurance, the benefits are relatively thin. The maximum weekly UI payment is set at $235, lower than in any state except for Louisiana. An average UI payment in Mississippi accounts for only 28.8% of the average weekly wage, much less than the national 33.9% replacement rate.

2. Alabama
>Pct. unemployed getting benefits: 16.9% (10th lowest)
> Pct. average weekly wage covered: 26.4% (5th lowest)
> Unemployment rate: 6.1% (6th highest)
> 1-yr. job growth: 1.3% (20th lowest)

Just 16.9% of Alabama’s unemployed population receives UI benefits compared to a national recipiency rate of 27.3%. Those who receive benefits get a maximum of $265 weekly, the fourth smallest amount in the country. On average, Alabamians receive significantly less than that at just $219.37, $116 less than the national average weekly benefits. The state’s jobless likely have a harder time than most finding work — the state’s unemployment rate of 6.1% is the sixth highest in the country.

1. Louisiana
>Pct. unemployed getting benefits: 13.5% (5th lowest)
> Pct. average weekly wage covered: 25.0% (2nd lowest)
> Unemployment rate: 6.3% (4th highest)
> 1-yr. job growth: -0.6% (5th lowest)

An unfavorable job market and an inadequate unemployment insurance program makes Louisiana the worst state for the unemployed. The state’s 6.3% unemployment rate is the fourth highest in the country, and its 0.6% decline in employment over the past year was the fifth worst. Louisiana residents filed 12.2% more unemployment claims in 2015 than in 2014, while UI claims nationwide fell by 6.8% last year.

Only 13.5% of Louisiana’s unemployed receive UI benefits, the fifth lowest recipiency rate in the country. For those who do, the benefits are relatively scant. The maximum weekly UI payment is set at $221, the least of any state. An average week’s UI payment covers just one-fourth of the average weekly wage in the state, the lowest replacement rate of any state except for Arizona.