RICHMOND, Va. (WRIC) — Virginia is losing its status as CNBC’s “Top State for Business,” according to new rankings released on Wednesday.

In 2021, Virginia became the first state to win the top spot for two years in a row. The title was often used to deflect Governor Glenn Youngkin’s campaign-trail claims that Democratic leadership “drove Virginia’s economy into a ditch.”

Now, with Youngkin at the helm, the state has fallen from number one to number three, behind North Carolina and Washington state.

Democrats are blaming Youngkin but at least one economist argues that’s not fair.

Fletcher Mangum, who was appointed to the state’s Joint Advisory Board of Economists by past Republican and Democratic governors, said the public data these ratings are based on largely reflect trends during the end of former Governor Ralph Northam’s term.

“Youngkin’s policy agenda was not enacted into law on the day of his inauguration. I mean, the man has only been in office for six months,” Mangum said.

Asked about the rating drop on Wednesday, Youngkin appeared unfazed.

“Virginia has not been performing like the best state for business and I was very clear with that all last year during the campaign,” Youngkin said. “The two areas that I’m very concerned about are the cost of doing business and the cost of living and this is where we’re really focused.” 

A dropping rating in the “workforce” category appears to be one of the most significant factors behind Virginia’s fall. Unlike last year, workforce carried the most weight in the 2022 survey. Virginia dropped from 3rd place among states in 2021 to 11th place in 2022.

In an analysis of the results, CNBC’s Scott Cohn wrote, “The Old Dominion became the first back-to-back Top State for Business in 2021 on the strength of its education system and its workforce. But net migration to the state among college-educated workers has slowed, according to Census figures, hurting the commonwealth’s Workforce ranking.”

Virginia slid in several other areas, including “economy,” “technology & innovation” and “life, health & inclusion.”

Democrats argued that Youngkin’s stances on things like abortion and same-sex marriage are driving business away.

“Governor Youngkin’s culture war and failed business practices are hurting Virginians and making our commonwealth less competitive,” said Senator Louise Lucas (D-Portsmouth). “That’s a damn shame if you ask me.” 

“We’re an open and welcoming state in Virginia and all the work that Governor Northam and the Democrats in Virginia did to make us number one, it doesn’t take far to fall down into that ditch,” said Virginia’s Democratic Party Chairwoman Susan Swecker.

Last year, CNBC paid “greater attention than ever” to equity and inclusion when weighting states.

Mangum said that could’ve influenced Virginia’s previous win.

“It doesn’t take much to change those rankings and, as they shift the weights around, things are going to happen that really, in terms of the overall business attractiveness of the state, probably are not that significant,” Mangum said. “At the end of the day, what really matters is not what CNBC says, but what the businesses say and whether they’re coming to the state, and they are coming to the state.” 

Barry DuVal, President & CEO of the Virginia Chamber of Commerce, said in a statement that the rising cost of doing business is making it harder to compete with states that have “aggressively cut taxes and streamlined regulations.”

Virginia’s rating actually improved slightly in that area, among others, compared to other states. In the “cost of doing business” category, Virginia went from 26th in 2021 to 25th place in 2022. On “cost of living,” the state went from 32nd to 30th.

Virginia also saw a significant boost in its infrastructure rating, from 24th to 9th place, and maintained its 2nd place rating on education.

“Today’s rankings confirm that Virginia is a leader in many areas where the Virginia Chamber has been active, notably enhancing our educational system and our recent investments in infrastructure,” DuVal said.