Sure, Michigan technically made the top 20, but before you grab your party horn, remember this: Michigan is also hemorrhaging residents and, according to the report, they rank 35th in overall economic performance.

Michigan’s economic engine is still sputtering.

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That’s a tough pill to swallow for a state once known as the beating heart of American industry. “Michigan is my home state – I grew up in Saginaw,” says Jonathan Williams, one of the three authors of the report. Reflecting on the state’s long fall from grace, Williams adds, “Saginaw was once a town of over 100,000 people… today it’s down to around 47,000. That’s a classic story of big government failure.”

The data backs him up. The report shows a state that ranks 36th in personal income tax rate, 41st in property tax burden and last place in estate/inheritance tax levied. The report also points to a “net of more than 200,000 Michiganders have left the state from 2014-2023.”

Right-to-Work gets left behind – and so does Michigan.

Williams, a fierce advocate for economic reform, tied some of Michigan’s problems to recent political shifts: “One big reason for the drop this year was the repeal of right-to-work. That happened under the Democrat trifecta… Losing right-to-work had a real impact on Michigan’s competitiveness.”

It’s not just a Midwest problem though. It’s a missed opportunity. While Michigan policymakers bicker in their now-divided government, other states are sprinting ahead. Utah, Tennessee, and Indiana topped the economic outlook list for 2025 by embracing low taxes, limited government, and free- market reforms.

When Ohio looks like a winner, you know it’s time to panic.

Even Ohio is starting to look like the popular kid in class. “I was just in Ohio,” Williams noted, “and frankly, the Buckeye State could eat the Midwest’s lunch if other states don’t keep up.”

If Michigan wants to avoid joining the economic bottom-feeders, it’s going to need more than just nostalgic nods to its auto-manufacturing past. With 2026 elections looming and Speaker Matt Hall’s GOP-led House trying to pump the brakes on tax creep, the next two years could determine whether the state finally hits the gas – or continues to stall in the driveway.

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ALEC CEO Lisa B. Nelson says, “To realize President Trump’s vision for a Golden Age of America, our path to economic revival must run through the states…Rich States, Poor States demonstrates that states embracing free-market principles become magnets for families, job creators, and opportunity. ALEC is proud to spotlight this competition and celebrate the states leading America’s comeback.”