Education, Quality of Life Drive CNBC ‘Top States’ Ranking

Connecticut climbed five spots to number 23 in CNBC’s 2026 America’s Top States for Business study, driven by top 10 rankings for education and quality of life.

The cable network’s latest annual competitiveness study also featured improvements in the business friendliness (21st), infrastructure (29th), economy (34th), and cost of doing business (40th) categories.

Connecticut’s education system—a perennial strength—rose one spot to fourth among all states in the latest study.

Quality of life, the only other category ranked in the top 10, remained unchanged at fifth overall.

However, Connecticut’s workforce ranking fell 17 places to 25th, highlighting the state’s rapidly shrinking labor force and the lack of available workers to fill more than 87,000 job openings.

The state’s cost of living ranking—a persistent drag on the economy—fell seven places to 44th, while access to capital dropped from 16th to 23rd.

Impact: Fiscal Reforms

CBIA president and CEO Chris DiPentima said the 2026 ranking represented Connecticut’s best performance in the 20-year history of the CNBC study.

“A decade ago, Connecticut’s business climate regularly ranked in the bottom 10 states, a consequence of our poor fiscal health and never-ending cycle of budget deficits and tax hikes,” he said.

“The gains we’ve made in recent years really reflect the importance of the state’s fiscal guardrails and the direct, meaningful impact of those critical budget reforms on our long-term economic prospects.”

DiPentima noted that CNBC regularly ranked Connecticut’s economy—which grew 2.4% last year, 12th fastest in the country—in the bottom 10 states before the legislature adopted the fiscal guardrails in 2017.

He added that the improvement in the state’s business friendliness rank coincided with CNBC adding the length and efficiency of a state’s permitting processes to the methodology used to develop the rankings.

“In the last two years, Connecticut has made real progress reforming the state’s land use and environmental permitting processes, including retiring the outdated Transfer Act,” he said.

“The collaboration between the business community and the Department of Energy and Environmental Protection and the Department of Economic and Community Development is a model for all state agencies.”

CNBC also now recognizes a state’s attitude toward emerging industries like quantum computing—which Connecticut is embracing—and artificial intelligence, which lawmakers have targeted with innovation-stifling regulations.

Workforce Concerns

Employers regularly cite the state’s workforce—along with proximity to customers and quality of life—as one of the top three advantages for running a business in Connecticut.

DiPentima called CNBC’s sharp downgrading of the state’s workforce ranking “really troubling, given that Connecticut’s workforce has traditionally been recognized as one of the state’s main economic assets.”

“We’ve long been recognized for our world-class, highly productive workforce, a reason companies often overlook the state’s high costs of living and doing business when making location and investment decisions.

“Connecticut simply cannot afford to lose that competitive advantage—sustained economic growth only happens with sustained job growth.

“Employers have been sounding the alarm about the state’s workforce issues for some time—policymakers must pay attention to this latest warning and address the factors driving this crisis.”

These are America's 10 most expensive states for 2026, where inflation is punishing residents https://t.co/dtN1sWGs3D

— CNBC (@CNBC) July 10, 2026

The population of those working and looking for work in Connecticut is now lower than in January 2010, while the labor participation rate has fallen more than five percentage points to 62.8%, 21st best in the U.S.

The state’s aging population, retirements, slower population growth, and affordability challenges are the primary factors impacting the labor force.

CNBC ranks Connecticut as one of the country’s 10 most expensive states for 2026, noting that the cost of basic goods is the ninth-highest in the nation, while inflation is eight-tenths of a point higher than the national average.

“Connecticut workers already earn some of the highest wages in the country, yet many families continue to struggle with the cost of housing, healthcare, energy, childcare, and other necessities,” DiPentima said.

“Policymakers must focus on lowering the underlying costs that make Connecticut so expensive for both families and employers.”

New England Region

Massachusetts was the highest ranked of the New England states, improving five spots to 15th in CNBC’s latest annual business climate study.

The Bay State was boosted by its top rank for education, along with top 10 rankings in the access to capital (6th), technology and innovation (8th), and quality of life (10th) categories.

New Hampshire rose two spots to 34th, boosted by top 10 rankings for business friendliness (6th), quality of life (7th), and education (9th).

Massachusetts was the highest ranked of the New England states, improving five spots to 15th.

Maine jumped eight places to 35th, boosted by top 10 scores for quality of life (2nd) and education (5th).

Vermont fell two spots to 40th—while ranked first again for quality of life, that was the state’s only top 10 score.

CNBC ranked Rhode Island 48th—down two spots—scoring the state in the bottom 10 for its economy (50th), access to capital (48th), infrastructure (46th), cost of living (45th), and cost of doing business (44th).

Top, Bottom States

Ohio, which broke into the top five in CNBC’s rankings for the first time in 2025, is the cable network’s top state for business this year. 

“It is the pinnacle of a long climb for the Buckeye State, once considered the buckle of the Rust Belt,” the study’s authors wrote.

“Ohio finished 30th in the inaugural CNBC study in 2007. Today, it is a magnet for growth, capital and innovation.”

Ohio ranked first for infrastructure—the top weighted category in this year’s study—first for cost of doing business, ninth for economy and cost of living, and 10th for technology and innovation.

Last year’s top-ranked state, North Carolina, finished second this year and has ranked first or second in each of the past six years.  

Virginia rose one spot to third, driven by high rankings for infrastructure (2nd), education (5th), technology and innovation (6th), and quality of life (7th).

Arkansas was this year’s most improved state, driven by a 23-place improvement in the workforce category.

Texas dropped two places in fourth, ranked first for workforce and second for economy and access to capital. 

Minnesota climbed five spots to fill out the top five states, ranked fourth for quality of life, seventh for infrastructure, eighth for economy, and 10th for education.

Arkansas was this year’s most improved state, rising 13 spots to 28th overall, driven by a 23-place improvement in the workforce category. 

Declining oil prices and lack of economic diversity largely accounted for Alaska’s fall from 48th to last place in this year’s CNBC study.

The high cost of doing business (50th), poor infrastructure (50th), and high cost of living (47th) saw Hawaii fall one spot to last this year.

Alaska improved one spot to 49th, followed by Rhode Island—the country’s fifth most expensive state to live—Louisiana, and West Virginia, which ranked 50th in the cost of living category.