Which States Are the Most Dependent on the Federal Government?

By on July 20, 2015 in Current Events with 7 Comments

Each state receives federal funds for economic support, but which states are the most dependent on this aid from the federal government?

WalletHub, a personal finance resource website, sought to answer this question with this interactive map (included below) that ranks each state’s dependency on financial aid from the federal government. Lighter colors indicate a greater dependency on federal funds.

WalletHub’s rankings of each state are based on four metrics, one of which was the number of federal employees in the state:

  1. Return on Taxes Paid to the Federal Government (Federal Funding in $ Divided by Federal Income Taxes in $): Weight = 1
  2. Federal Funding as a Percentage of State Revenue (Federal Funding in $ Divided by State Revenue in $ then Multiplied by 100): Weight = 1
  3. Number of Federal Employees per 1,000 Residents (Number of Federal Workers Divided by Number of State Residents): Weight = 0.5
  4. Number of Civilian Non-Defense Federal Employees per 1,000 Residents (Total Federal Civilian Employment Minus Total Civilian Employment of Army, Air Force, Navy & Defense Department): Weight = 0.25

Which states were found to be the most dependent? These are the 10 most dependent (the rankings go from least dependent (#1) to most dependent (#50):

State Return on Taxpayer Investment (Category Rank) Federal Funding as % of State Revenue (Category Rank) Federal Employees per 1,000 Residents (Category Rank) Number of Civilian Non-Defense Federal Employees per 1,000 Residents (Category Rank)
South Carolina $5.38
(50)
32.50%
(23)
12.74
(34)
2.42
(9)
Maine $1.58
(40)
35.42%
(38)
8.73
(23)
3.04
(17)
South Dakota $0.80
(20)
39.78%
(47)
14.42
(36)
8.69
(46)
Louisiana $1.37
(36)
42.21%
(48)
8.40
(21)
3.15
(19)
Arizona $1.47
(39)
36.26%
(39)
9.34
(28)
4.95
(37)
West Virginia $1.91
(43)
34.91%
(35)
8.91
(25)
7.66
(44)
Montana $1.24
(33)
37.49%
(41)
13.51
(35)
8.74
(47)
Alabama $2.46
(48)
36.64%
(40)
10.36
(31)
3.19
(20)
Kentucky $2.18
(45)
35.26%
(37)
15.38
(40)
3.61
(28)
Mississippi $2.34
(47)
43.68%
(50)
10.61
(32)
3.41
(24)
New Mexico $2.19
(46)
37.89%
(42)
18.50
(45)
9.03
(48)

Source: WalletHub

© 2016 Ian Smith. All rights reserved. This article may not be reproduced without express written consent from Ian Smith.

About the Author

Ian Smith is one of the co-founders of FedSmith.com. He enjoys writing about current topics that affect the federal workforce. Ian also has a background in web development and does the technical work for the FedSmith.com web site and its sibling sites.

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