Global| Jun 22 2021State Personal Income in Q1 2021
|in:Viewpoints
Summary
State personal incomes grew at spectacular rates in 2021:Q1, reflecting the disbursement of Federal transfers. Unsurprisingly, aggregate growth rates were strongest in poor states, where flat dollar transfers made a larger different: [...]
State personal incomes grew at spectacular rates in 2021:Q1, reflecting the disbursement of Federal transfers. Unsurprisingly, aggregate growth rates were strongest in poor states, where flat dollar transfers made a larger different: Mississippi had the highest growth rate (89.3 percent at an annual rate), and West Virginia was number 2. Wealthier states were at the bottom: Connecticut was 50th (DC was even lower), California 49th, Massachusetts 48th, etc.
The growth of net earnings (employee compensation plus proprietors’ income) provides a better snapshot of how the recovery was proceeding. Three states (Texas, Michigan, and Tennessee) saw double-digit growth rates; six saw declines, with South Dakota’s falling at an 11.1 percent annual rate. In general, the Northeast (New England and the Mideast), Great Lakes, Rocky Mountain, and Southwest tended to be strong, with the Plains and Far West softer. The upshot is that more industrial states were typically stronger, and more agricultural and energy production-centered states were typically softer. Recoveries in leisure and hospitality started too late in the quarter to exert much leverage on state growth (both Hawaii and Nevada reported below-average growth in net earnings).
Charles Steindel
AuthorMore in Author Profile »Charles Steindel has been editor of Business Economics, the journal of the National Association for Business Economics, since 2016. From 2014 to 2021 he was Resident Scholar at the Anisfield School of Business, Ramapo College of New Jersey. From 2010 to 2014 he was the first Chief Economist of the New Jersey Department of the Treasury, with responsibilities for economic and revenue projections and analysis of state economic policy. He came to the Treasury after a long career at the Federal Reserve Bank of New York, where he played a major role in forecasting and policy advice and rose to the rank of Senior Vice-President. He has served in leadership positions in a number of professional organizations. In 2011 he received the William F. Butler Award from the New York Association for Business Economics, is a fellow of NABE and of the Money Marketeers of New York University, and has received several awards for articles published in Business Economics. In 2017 he delivered Ramapo College's Sebastian J. Raciti Memorial Lecture. He is a member of the panel for the Federal Reserve Bank of Philadelphia's Survey of Professional Forecasters and of the Committee on Research in Income and Wealth. He has published papers in a range of areas, and is the author of Economic Indicators for Professionals: Putting the Statistics into Perspective. He received his bachelor's degree from Emory University, his Ph.D. from the Massachusetts Institute of Technology, and is a National Association for Business Economics Certified Business EconomistTM.