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Connection Between a Quality Workforce and A State’s Success

ByBlake Decker

The connection between a quality workforce and the success of a state is unquestioned. In our previous blog post, we introduced America’s Top States for Business study from 2022. Throughout the 14 years of the CNBC study, Texas has had the best average ranking of 2.2 across all years in the data. However, in the last two rankings, Texas has slid to 4th and 5th overall in 2021 and 2022 respectively. This blog post starts to dissect the underlying constructs that comprise the overall rankings, starting with the quality of the state’s workforce.

In the CNBC’s methodology, there is a total of 2,500 points available across the 88 metrics. The highest-weighted category is “Workforce” quality, which accounts for 16% of the overall ranking with 410 total points available. As you can see in the map visualization below, Texas (2nd overall with 299 points) was one of three states given “A+” ratings for the quality of workforce. The others were Colorado (1st – 302 points) and Georgia (3rd – 297 points). Rounding out the Top 10 states for quality workforce were Washington (4th – 282), Delaware (5th – 277), Florida (6th – 274), Arizona (7th – 273), Utah (8th – 269), Oregon (9th – 259), and Maryland (10th – 257).
In the workforce article, CNBC highlights several data points used for the workforce quality scores for the Top 10 states:

  • Net Migration of Skilled Workers: Texas does very well in the rankings in terms of how many college-degreed workers move into the state versus how many move out of Texas to other states. While the raw net migration data were not published by CNBC, Texas ranked 3rd in the net migration metric, trailing Florida (1st) and Washington (2nd) within the Top 10 states. Conducting an independent analysis of American Community Survey (ACS) data showed that an estimated 158,792 adults with a bachelor’s degree or higher migrated from other states to Texas in 2021, trailing only Florida (176,740) and California (173,209).
  • Adults with Bachelor’s Degree or Higher: Within the Top 10 list, CNBC showed that Maryland is the highest-rated state in the Top 10 with 41% of adults (25 and over) having a bachelor’s degree or higher, with Colorado and Washington tied for second at 36.7%. Texas is ranked 8th out 10 in this group with 30.7% of adults having a bachelor’s degree or higher. When independently comparing all states in the 2021 ACS data, Texas is the 27th-ranked state overall for adults (25+) with a bachelor’s degree or higher, which is tied with Florida.
  • Career Education Credential: In addition to the bachelor’s degree or higher data, the workforce quality category includes career education credentials defined as “workers with associate degrees or industry-recognized certificates” (CNBC). On this metric, Texas ranked 7th out of the Top 10 states at 16.3%, as Colorado was ranked highest at 41.6%, followed by Arizona at 23.8% and Washington at 21.7%. Since part of the Career Education Credential metric includes adults with associate’s degrees, an independent analysis of ACS data showed that Texas ranked 47th in the country in the percentage of adults (25+) whose highest level of educational attainment is an associate’s degree in 2021.
  • STEM Workers: Based on data from the US Bureau of Labor Statistics (BLS), the CNBC workforce rankings also include the percentage of a state’s workforce that is in a STEM (science, technology, engineering, or mathematics) field. In the Top 10 states for workforce quality, Washington (10.2%), Maryland (10.1%) and Colorado (9.2%) were the highest-ranked states, while Texas (6.6%) ranked 7th out of the Top 10 states. An independent analysis of the BLS data showed that Texas ranked 17th overall in terms of STEM workers when compared to all 50 states in the 2021 data estimates.

So What?

Texas’ overall ranking of 2nd in the Workforce Quality domain of the CNBC study is impressive. In the narrative regarding Texas’ ranking, the article states that “skilled workers are heading to the Lone Star State in droves” and that “Texas is in the top ten for workforce productivity, with $139,549 in economic output per job last year” (CNBC; economic output raw data not provided). However, with Texas ranking in the middle of the pack in adults with a bachelor’s degree or higher, in the bottom handful of states in terms of adults with an earned associate’s degree, and outside the top 10 in terms of STEM workers, opportunities for improvement within the education space remain. We will look at other general areas of concern in the CNBC rankings in our next blog post.