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After three years in the number one spot, Utah has dropped to third in Forbes magazine's Best States for Business list.

Virginia, ranked No. 2 the past three years, earned the top spot for the first time since 2009 in the magazine's eighth annual listing. North Dakota ranked second.

The list is based on criteria that include pro-business regulatory environments, educated workforces and reasonable business costs.

According to Forbes, Utah's economy has expanded 2 percent over the past five years, 4th best in the United States. The state received praise for low energy costs, which are 29 percent below the national average. Forbes reported Utah has $130 billion gross state product.

North Carolina and Colorado rounded out the top five in the Forbes list.

The magazine thinks highly of Utah's economy. In its recent 2013 rankings of the top 25 places for businesses and careers, Provo ranked second, Salt Lake City 12th and Ogden 16th.

Utah business officials took the news of the state's drop by two spots in stride.

Spencer Eccles, executive director of the Governor's Office of Economic Development, said the rankings are a welcome sign that the U.S. economy is recovering. He said Utah has a job growth rate of 3 percent, nearly triple that of Virginia's, as well as an unemployment rate of 4.6 percent compared to Virginia's 5.7 percent.

"We continue to be competitive," he said. "We believe we will be at the head of the pack."

Jeff Edwards, president and CEO of the Economic Development Corporation of Utah, said that when Utah first became ranked No. 1 in 2009 on the Forbes list, there was some surprise because of its relatively moderate-sized economy.

This year's top three states are quite diverse. Virginia, which relies heavily on the federal government, has a $450 billion economy. North Dakota, which is booming due to energy development, is $66 billion, with Utah somewhere in between. Edwards said that because Utah's economy is more diverse, he feels it has more long-term prospects for sustainable growth.

"The good news is that other parts of the country are seeing the recovery that we have seen the past few years," said Edwards. "That's a positive sign."

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