Personal Income Grew in Every State in the First Quarter of 2011
According to estimates released today by the U.S. Bureau of Economic Analysis (BEA), state personal income grew in all 50 states in the first quarter of 2011, ranging from.7 percent in Iowa to a high of 6.9 percent in North Dakota. Overall, state personal income grew by 1.8 percent, up from a 0.8 percentage growth rate the previous quarter. Inflation grew alongside personal income, increasing to 0.9 percent in the first quarter from 0.4 percent in the fourth quarter of 2010.
Experts point to a two-percentage point reduction in the personal contribution rate for social security (one of the provisions of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010) as the primary reason behind the income growth in most states.
The mining and durable-goods manufacturing industries performed best overall in the first quarter.
The mining industry (including oil and gas extraction) contributed more than any other nonfarm industry to earnings growth in six of the seven fastest growing states (North Dakota, Wyoming, Texas, Montana, Oklahoma, and Alaska). Overall, mining earnings grew 5.5 percent during the first quarter.
In 26 states, durable goods contributed substantially to income growth. Four of these states (Mississippi, New Hampshire, Washington, and Wisconsin) were among the fastest growing states in the first quarter. In the state of Washington durable-goods manufacturing contributed one half percentage point to personal income growth.
Although mining and durable-goods earnings jumped in the beginning of 2011, they remained below their pre-recession levels. U.S. mining earnings were 3.9 percent below their peak in the third quarter of 2008 and U.S. durable-goods earnings remained 4.7 percent below their peak in the second quarter of 2008.
Read More: BEA