North Carolina is America’s Top State for Business in 2025

With a solid economy, a world-class workforce, and a wealth of corporate hospitality, North Carolina is America’s Top State for Business in 2025.

The Tar Heel State is on a roll. It captured top honors in the annual CNBC rankings in 2022 and 2023, and it was runner-up in 2021 and 2024 — missing the top spot last year by just three points to Virginia, which slips this year to its lowest position among states since 2018.

North Carolina is not only winning the CNBC rankings, it’s also attracting a steady stream of new business.

“North Carolina offers the ideal combination of talent, infrastructure, and forward-thinking leadership to support our mission to reshape aviation,” said Tom O’Leary, CEO and co-founder of JetZero, an aviation startup manufacturing fuel-efficient airliners, which announced June 12 that it will build its first factory, with 14,500 jobs, in Greensboro.

Also in June, Amazon announced it would invest $10 billion to build new data centers in North Carolina, on top of the $12 billion the company says it has invested in the state since 2010.

“This latest expansion is a testament to the state’s thriving business ecosystem and talented workforce,” the company said in a statement June 4.

CNBC’s data backs up those conclusions.

North Carolina finishes No. 3 in the all-important Economy category of this year’s study, behind only Florida and Texas. The state’s gross domestic product grew by a healthy 3.7% last year, the fifth-strongest in the country. The state added more than 60,000 jobs last year.

Those jobs add to a well-rounded workforce — America’s fourth-best, according to the CNBC study. According to Census data, North Carolina finishes third — behind Florida and Maine — in net in-migration of college-educated workers on a percentage basis. North Carolina finishes in the top tier both for science, technology, engineering and math, or STEM, employees, and for its pipeline of vocational and career-educated workers.

Attracting business is a goal both political parties agree on

While no state is more politically divided than deep purple North Carolina, both parties seem to agree on the importance of keeping business happy.

“In recent years, we’ve recruited businesses that have created tens of thousands of jobs across the state,” Gov. Josh Stein, a Democrat in his first year in office, said in his state of the state address in March. “But we cannot rest on our laurels. Other states want what we have here — it’s a competitive world.”

Governor Josh Stein noted in an interview with CNBC on Thursday that since January of this year, when he was sworn in, the state has announced more than $20 billion worth of investments that include 23,000 jobs.

“My priority, and I think the priority of Senate Republicans, will be to continue those policies that have provided that kind of environment that has made North Carolina attractive to private sector businesses,” state Senate President Phil Berger told The Carolina Journal in March. “Those sorts of things don’t happen by accident. That kind of growth doesn’t happen just by happenstance.”

North Carolina finished fourth in the Business Friendliness category of the CNBC study. Tort liability costs are the third-lowest in the country, according to the U.S. Chamber of Commerce Institute for Legal Reform. The state is in the top 10 for “economic freedom,” according to the Fraser Institute, a Vancouver-based libertarian think tank, which gave the state high marks for its approaches toward government spending and labor regulation.

As North Carolina legislators battle over the state’s budget and tax policy, Stein told CNBC he has no intention of raising taxes.

“No one likes to pay taxes, so we want taxes to be as low as possible,” he said. But he also noted that the state already has the lowest corporate income tax of any that levies one, and what Stein said he does not want is to “imprudently continue to go to zero when we have all this fiscal uncertainty coming from Washington.”

With the expectation of greater state spending on health care and food assistance, given the changes being made to federal support for Medicaid and SNAP program benefits in Trump’s tax and spending bill, Stein said his message to state legislators is: “Let’s go slow and make sure we have the fiscal situation we need to succeed well into the future.”

While North Carolina is almost unfailingly friendly to business, it is not terribly friendly to workers. The state comes in at No. 29 for Quality of Life — its worst category in the CNBC study this year. Oxfam International, a left-leaning anti-poverty organization, ranks North Carolina dead last in its annual report on The Best and Worst States to Work in the U.S., citing an almost complete lack of worker protections. Also, North Carolina is one of only five states with no law protecting nondisabled people from discrimination in public accommodations, according to the National Conference of State Legislatures.

Hurricane damages, Medicaid cuts could hurt business climate

North Carolina’s biggest headwinds, however, come from areas that are much harder for a state to control.

The state is still in the early stages of recovery from Hurricane Helene, which killed 100 people and destroyed thousands of homes in North Carolina alone, causing nearly $60 billion in damages in the state. The storm, and subsequent flooding, struck in September, which means that much of the economic impact may not be reflected in this year’s Top States data. The state has appropriated upward of $2 billion in recovery funds, which could accelerate if the Trump administration follows through on plans to phase out FEMA. North Carolina is also among the top recipients of research grants from the National Institutes of Health and the National Science Foundation, which are now on the chopping block.

Stein said that as a bigger state than most, North Carolina has a sophisticated emergency response system, but he says it is critical for the federal government to maintain its primary role in disaster management. “We don’t get a huge storm every year, but the country does. It doesn’t make sense for every state to have a fully staffed emergency response team,” he said.

The cost of disaster response is also too high for any state alone to bear, Stein said, speaking of the $60 billion in recent damages seen across in North Carolina from storms like Hurricane Helene. “Only the federal government can do that,” he said, noting North Carolina has an $11.5 billion request before Congress and the administration. “I eagerly hope they fund it soon,” he said.

Other Trump policies could also hurt the state. Sen. Thom Tillis, who announced June 29 that he would not seek reelection after opposing the president’s signature tax-and-spending bill, warned that Medicaid cuts could cost the state as much as $32 billion and cause more than 600,000 North Carolinians to lose their health insurance.

“It’s a real concern. This bill will result in real harm to North Carolina, harm to people and health care,” Stein said. “You cannot do that and not have human suffering. We have a lot of rural hospitals and those are where uninsured people will predominantly live and [those hospitals] will be the ones at risk of closing. We are very concerned,” Stein added.

He pointed to the bipartisan success achieved in North Carolina two years ago when the state expanded Medicaid coverage to 660,000 people. “Now we have to come together to defend Medicaid,” Stein said.

And that’s not all. More than 20% of North Carolina’s GDP in 2024 came from international trade in goods, according to data supplied for the CNBC study by Trade Partnership Worldwide. That leaves the state vulnerable to the impact of higher tariffs, which Stein told CNBC can already be seen in a recent reduction in traffic at the state’s biggest port in Wilmington resulting from a trade policy that “changes practically on a daily basis.”

“We need to have stability, businesses need certainty, so they can figure out how and where to invest,” Stein said.

But at least North Carolina steers into those headwinds from a strong position.

Scoring all 50 U.S. states

The CNBC study measures all 50 states across 10 categories of competitiveness, for a total of 2,500 possible points. North Carolina racks up 1,614 points to capture this year’s crown.

Our methodology assigns a weight to each category based on how frequently states cite it as a selling point. The idea is to measure the states based on the criteria they use to pitch themselves to businesses.

Here are this year’s categories and point totals:

Economy: 445 points (17.8%)Infrastructure: 405 points (16.2%)Workforce: 335 points (13.4%)Cost of Doing Business: 295 points (11.8%)Business Friendliness: 270 points (10.8%)Quality of Life: 265 points (10.6%)Technology & Innovation: 255 points (10.2%)Education: 110 points (4.4%)Access to Capital: 60 points (2.4%)Cost of Living: 60 points (2.4%)

The rest of the Top States

Texas is the runner-up in this year’s rankings, with the top rating in the Workforce category. The Lone Star State is unparalleled when it comes to drawing in workers, according to a worker attraction index developed for CNBC by labor market data firm Lightcast. But Texas has serious Quality of Life issues, finishing No. 49 in the category. The state has the largest percentage of people without health insurance, crime is on the high side, and state laws offer few protections against discrimination.

Florida climbs to third place this year, with the top rating in Economy for the third consecutive year. But the state’s strong growth and its lingering insurance crisis are forcing up costs. The Sunshine State is now third-highest in Cost of Living.

Virginia, which has run neck-and-neck with North Carolina since 2021 for the top spot in CNBC’s rankings, slips to fourth place this year. The Old Dominion is still a business powerhouse, tops for Education, and second best for Infrastructure. But the state’s interdependence on the federal government — an economic boost in most years — leaves its economy on less solid footing as federal budget cuts loom.

Ohio joins the top five states for the first time with America’s top ranking in Infrastructure. More than 142 million people live within a day’s drive of Ohio, more than any other state. The Buckeye State also offers the second-lowest cost of doing business, after Oklahoma.

This year’s Most Improved State is Massachusetts, which climbs 18 spots to No. 20 overall, bouncing back from the biggest decline last year. The Bay State still has serious issues. It’s the second-most-expensive state to do business in. And cuts in federal research dollars — not just to Harvard University, but also to other institutions in the state — seriously threaten the state’s heritage of innovation. But overall, Massachusetts is less dependent on Washington than most states.

The Center on Budget and Policy Priorities estimates that federal funds comprise just 30% of state spending in Massachusetts. That is the 14th-lowest percentage among states, helping the state in the crucial Economy category.

The Bottom States

We rank all 50 states, so if there are Top States, there must also be Bottom States.

Tied at No. 46 are Louisiana and Rhode Island.

The federal government funds half of state spending in Louisiana — more than any other state — leaving the state seriously vulnerable to the Trump budget cuts. The state’s roads and bridges are among the worst in the country.

Rhode Island is the fifth-most-expensive state to do business in, and it ranks No. 46 for Business Friendliness.

Montana finishes at No. 48 overall, with America’s worst ranking in the Workforce category. Montana workers rank No. 48 for productivity in terms of economic output per job, and state worker training programs are the least effective in terms of recipients finding employment within six months.

Hawaii finishes No. 49, with America’s highest cost of doing business and the second-highest cost of living.

In last place is Alaska. Try as it might, The Last Frontier cannot wean itself from its dependence on oil, and with the price of North Slope crude down about 12% from a year ago, Alaska ranks last in the Economy category.

Join the conversation. Didn’t see your state mentioned? You can see where it ranked overall, and in all 10 categories of competitiveness, in the full rankings of the 2025 America’s Top States for Business.