Ohio may be the heart of it all, except for business.
According to a new review from the personal finance site WalletHub, the Buckeye State ranked No. 40 for its unemployment rate change. Nationally, South Dakota, Connecticut, and New Hampshire have the best unemployment rate changes.
WalletHub compared all 50 states and the District of Columbia using a half dozen key metrics to understand how unemployment rates are changing nationwide. It examined unemployment rate statistics from December 2024, the latest available data, against key dates in 2019, 2020, 2023 and 2024.
Ohio ranked better than Kentucky (No. 51), Michigan (48) and Indiana (44) but behind West Virginia (28) and Pennsylvania (17).
“Ohio’s No. 40 ranking in unemployment reflects both the ongoing challenges and opportunities within the state’s labor market,” WalletHub writer and analyst Chip Lupo told Ohio.news via email. “While the unemployment rate of 4.4% in December 2024 is a sign of some instability, the state’s job market has seen [improvement] compared to previous years, with a 23.1% reduction in unemployment since December 2023.”
“However, the modest decrease in continued claims (28.2%) and a higher-than-average unemployment rate suggest that state leaders should focus on creating sustainable, long-term solutions to enhance job growth, particularly in sectors such as healthcare, government, and social assistance, which have shown recent gains,” Lupo said. “Addressing these concerns will be key to improving Ohio’s overall employment landscape and supporting economic stability.”
Lupo said Ohio’s ranking reflects moderate improvements and underlying challenges.
“While the state has seen job gains in healthcare, government, and social assistance, its unemployment rate of 4.4% remains relatively high,” Lupo said. “Ohio’s slow decrease in continued claims suggests that job creation efforts may not be widespread enough or aligned with emerging industries.”
Ohio has a high number of government jobs, and according to U.S. News & World Report, the state has the ninth-highest number of federal civilian employees of any state.
“Ohio’s high number of government jobs may provide some stability but doesn’t drive rapid economic growth, which is a key factor in its No. 40 unemployment ranking,” Lupo said. “While there are job gains in sectors like healthcare and government, Ohio’s unemployment rate remains high.”
Like all states, Ohio policymakers have made growing the state’s workforce an important talking point. Lupo said an increased focus on workforce development and upskilling could help align the state’s labor force with emerging industries, thus improving its unemployment rate and boosting long-term economic growth.
“Ohio policymakers should focus on workforce development, increase support for high-growth sectors, and enhance efforts to diversify its economy, ensuring more sustainable job opportunities across all sectors,” Lupo said.
Another area that could also help is making the state more business-friendly, and a proposed measure lawmakers are considering could do just that.
Senate Bill 3 would lower the state’s nonbusiness income tax to a flat rate over two years, making it one of the lowest in the country. Proponents say this would encourage out-of-state businesses to move to Ohio.
The Senate Ways and Means Committee gave the bill its first hearing this week. Ohio isn’t alone; fast-growing states like Georgia and South Carolina have also worked to lower their income tax rates in recent years.
“Yes, there are key lessons policymakers in Ohio can take from some of the top-ranking states,” Lupo said. “South Dakota’s success, highlighted by an unemployment rate below 2%, reiterates the importance of a business-friendly environment, low taxes, and policies that foster private-sector job growth. Ohio could consider these factors to improve its ranking by encouraging more private sector innovation and attracting businesses that create sustainable job opportunities.
“Connecticut, which ranks highly due to its significant decrease in unemployment, shows the value of targeted workforce development and investments in sectors like technology and healthcare,” Lupo added. “Ohio could strengthen its focus on upskilling initiatives and aligning its workforce with high-growth industries to reduce its unemployment rate.”
