CNBC’s education rankings: How Minnesota has quietly dropped

Minnesota’s Top 5 ranking for business by CNBC caught attention recently, as my colleague John Phelan wrote about here. But the state’s drop in the education subindex over the years is getting less scrutiny.

The media company’s annual “America’s Top States for Business” uses 86 different metrics in 10 key categories of competitiveness to measure all 50 states against each other. One of those categories is education, which Minnesota ranks #13.

What is first worth noting is that Minnesota’s education ranking for 2023 has declined a good amount since CNBC’s 2019 study — falling from #3 in 2019 to #13 in 2023. This is among the Top 10 steepest ranking declines over this time period. (Minnesota 4th grade reading and 8th grade math scores on national tests are the lowest they have been in 30 years.) Compare Minnesota’s education ranking decline over the past several years to Mississippi’s education ranking jumping up 17 spots from 2019 to 2023.

Second, as I have written before, it’s important to understand the methodology used in state rankings to grasp what is represented. Back in May, U.S. News & World Report ranked Minnesota the #5 best state in the country, but as I explain here, diving into the details of a ranking will show its limitations.

The same is true with CNBC’s. CNBC looked at multiple measures of K-12 education, including test scores, class size, and spending. They also considered the number of colleges and universities in each state, as well as long-term trends in state support for higher education.

While I don’t know what test scores they analyzed, if we assume it was results from the National Assessment of Educational Progress (NAEP), given that is the only national test that can be used to compare student performance in one state to another, simply using average scores for a state ignores student heterogeneity. This can end up skewing rankings because it treats states as though they have identical students, which “ignore[s] the substantial variation present in student populations across states,” write Stan Liebowitz and Matthew Kelly for the Cato Institute. For example, Minnesota’s average scores tend to be higher than Mississippi’s, but a breakdown of student population scores shows Mississippi black and Hispanic students outperforming Minnesota black and Hispanic students on nearly all national tests. And Mississippi serves a larger number of black students compared to Minnesota.

Additionally, including spending in calculating rankings risks “giv[ing] extra credit to states that spend excessively to achieve the same level of success others achieve with fewer resources, when that wasteful extra spending should instead be penalized in the rankings,” continue Liebowitz and Kelly.

Accounting for these limitations, is our state’s education system still doing better than others? Yes. Is there room for improvement before the state has full bragging rights? Most definitely.