State Personal Income: First Quarter 2010


State personal income growth averaged 0.9 percent in the first quarter of 2010 up from 0.5 percent in the fourth quarter of 2009, according to estimates released today by the U.S. Bureau of Economic Analysis. Personal income increased in all but two states with growth ranging from 1.6 percent in Mississippi to –2.0 percent in North Dakota. Inflation, as measured by the national price index for personal consumption expenditures, declined to 0.4 percent in the first quarter from 0.6 percent in the fourth quarter.[1]

Net earnings grew 0.7 percent in the first quarter. For the U.S and twenty states, net earnings grew at the fastest pace since the recession began (in the fourth quarter of 2007).

Transfer receipts grew 3.0 percent. American Recovery and Reinvestment Act (ARRA) transfer receipts rose to $113.5 billion in the first quarter and contributed 0.1 percent to U.S. personal income growth. There were small declines in ARRA payments in some states while in other states the increases were substantial. In Mississippi, 0.7 percentage point of first quarter personal income growth (almost half) is attributable to rising ARRA payments (estimates for all states are available at

Property income fell 0.4 percent nationally in the first quarter as declines in dividends offset rises in interest and rental income. Property income fell the most in Wyoming, 1.2 percent, reflecting the relatively high share of dividends in that state's property income. Property income rose 1.0 percent in Louisiana, boosted by an increase in homeowner assistance payments related to Hurricane Katrina. (These payments are treated as a component of the rental income of persons.)

Earnings by industry. The industry making the largest contribution to first-quarter personal income growth nationally was health care. The administrative and waste management industry and the military made the next largest contributions. The military received a 3.4 percent pay raise in the first quarter while federal civilian workers received an average 2.0 percent increase. Construction and real estate earnings continued to fall.

Farming contributed more than one-third of earnings growth in Kansas, the state where earnings grew the most the first quarter: 1.9 percent. At the same time farming accounted for all of the earnings decline in North Dakota, the state where earnings fell the most: 2.5 percent. The different performance of farming in the two states reflects the relative importance of earnings from livestock operations (which grew) and from crops, particularly wheat (which declined).

NOTE.–Quarter-to-quarter percent changes are calculated from unrounded data and are not annualized. Quarterly estimates are expressed at seasonally adjusted annual rates, unless otherwise specified. Quarter-to-quarter dollar changes are differences between published estimates.

[1]Calculated from the price indexes in Table 6 of the May 27, 2010 BEA News Release, Gross Domestic Product: First Quarter 2010 (Second Estimate).

Source: Bureau of Economic Analysis