Global| Sep 24 2020State Personal Income in Q2 2020
|in:Viewpoints
Summary
The pandemic utterly dominated state income numbers in the second quarter. Every state saw a double-digit rate of decline in earnings from employment and noncorporate business. Every state saw a double-digit rate of growth in [...]
The pandemic utterly dominated state income numbers in the second quarter. Every state saw a double-digit rate of decline in earnings from employment and noncorporate business. Every state saw a double-digit rate of growth in aggregate personal income, as the tidal wave of federal support swamped the collapse in earnings. The federal support, though, was not uniformly distributed by state. For example, New Jersey experienced a 63.0 % rate of growth in aggregate personal income, thanks to a more than 3000 % rate of increase in transfer payments. New York's income gain was barely one-third of New Jersey's, as transfer payments to Empire State residents rose at a "meager" rate of a bit over 800 %. BEA will be releasing on October 15 state data on the distribution of pandemic relief; at that point we may gain a bit more insight into what happened in the second quarter and what it may entail for income going forward.
The earnings data show declines in most major private sectors, outside of agriculture, resource extraction, utilities, and finance, in virtually every state. Retail trade, transportation, real estate, education, health care and social assistance, entertainment, and accommodation and food services were down everywhere.
While the raw aggregate numbers are quite uninformative, for what it's worth Massachusetts had the highest rate of growth of personal income, at 76.3 %, while Tennessee was lowest, at 15.8 %.
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.