A new comprehensive study has revealed that Rhode Island, despite being the smallest state in the United States, has achieved a significant distinction in workplace satisfaction. According to research published by human resources firm Bamboo HR, Rhode Island boasts the happiest employees in the nation, with their employee happiness score soaring 46 percent higher than the national average.
The Study's Methodology and Key Findings
The research, released on Tuesday, assessed employee happiness based on a scoring system that measured how likely individuals were to recommend their workplace to others. This positive recognition for Rhode Island arrives during a challenging period for the American labor market. Unemployment rates persist near four-year highs, younger workers face diminished opportunities as older employees remain in the workforce longer, and the growing influence of artificial intelligence continues to pose threats to jobs across multiple sectors.
Top and Bottom Performing States
The study identified a clear ranking of states based on employee contentment. Following Rhode Island, the top five states with the happiest employees are Maine, Hawaii, Arizona, and Alaska. Conversely, New Hampshire received the lowest employee happiness score, with Connecticut, Wyoming, Montana, and Oregon also ranking among the bottom five states for workplace satisfaction.
Rhode Island's labor market, as detailed by 2025 data from the state's Department of Labor and Training, comprises 45,239 private companies and 427,086 workers. A notable characteristic is the dominance of smaller businesses; companies employing fewer than 20 people constitute 92.4 percent of all employers and account for 26.6 percent of the workforce.
The Crucial Role of Turnover and Labor Dynamics
One of the most significant conclusions from the research is that employee happiness appears largely unrelated to traditional factors such as geographic location, political ideology, or income levels. The study found that both the highest and lowest ranking states are geographically dispersed across the country, suggesting these elements are not primary determinants.
Instead, the analysis indicates that employee happiness is fundamentally shaped by labor-market dynamics, particularly opportunity and mobility. The research explicitly notes that "employee happiness is shaped far more by labor-market dynamics - especially opportunity and mobility - than by place-based factors like regional culture, cost of living, income levels, or politics." It further explains that states with similar industrial bases and demographics can experience vastly different sentiment outcomes depending on how freely workers can move between jobs and how retention and opportunity interact within the market.
Four Categories of Labor Market Turnover
The study developed a framework to classify state labor markets into four distinct turnover categories, which strongly correlate with employee happiness levels:
- Ideal stability: Characterised by high employee satisfaction and low turnover rates.
- Healthy dynamism: Featuring high satisfaction alongside high turnover.
- Acute attrition: Marked by low satisfaction and high turnover.
- Hidden risk: Exhibiting low satisfaction despite low turnover.
All five states with the happiest employees, including Rhode Island, received classifications of either "ideal stability" or "healthy dynamism." In stark contrast, the five states with the lowest happiness scores were designated as having "acute attrition" or "hidden risk" labor markets. This classification underscores the pivotal relationship between job satisfaction, employee retention, and the overall fluidity of the labor market, suggesting that happiness is intrinsically linked to workers' perceptions of opportunity and their ability to navigate their careers.
