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Why state personal income is up from pre-pandemic levels, despite less aid | Tuesday Morning Coffee

Adjusted for inflation, personal incomes were up 4.1% in the second quarter of 2021 from the last full quarter before the pandemic, new research shows

November 16, 2021 7:16 am

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Good Tuesday Morning, Fellow Seekers.

Personal incomes nationwide dipped during the second quarter of 2021, compared to the stratospherically high levels they reached in 2020, when Washington dropped billions of dollars in temporary relief payments into Americans’ bank accounts.

But even with this dip, according to new data from the Pew Charitable Trusts, personal income was still up in all 50 states thanks to still vigorous government relief payments, wage growth, and other compensation.

Below, a look at those changes, visualized:

(Source: The Pew Charitable Trusts)

Nationwide, personal incomes from all sources were up an inflation-adjusted 4.1 percent in the second quarter of 2021 from the last, full quarter before the pandemic, according to Pew.

While earnings, which make up the bulk of personal income, inched upward as the economy bounced back this year, higher levels of government assistance were still the biggest drivers of states’ gains, according to Pew. In all, personal income in 18 states were below pre-pandemic totals when government assistance was excluded.

And since 2019, South Dakota and a group of western states have charted the strongest growth in total personal income, according to Pew. Below, a state-by-state look at income growth.

(Source: The Pew Charitable Trusts)

Here’s a closer look at some of that state-level data, courtesy of Pew, which compared states’ annualized growth rates for total inflation-adjusted personal income between the fourth quarter of 2019—before the pandemic and recession—and the second quarter of 2021.

They found that:

  • “After South Dakota’s 6.1% annualized rate, the fastest growth in total personal income since the pandemic was in California (5.9%), Idaho (5.6%), Washington (5.4%), Nebraska (5.3%), Arizona and North Dakota (both 5.2%), and Georgia (5%).
  • “Six of the 10 states with the fastest growth rates were in the West. The same states experienced some of the sharpest long-term population gains, a trait typically associated with a strong labor force and economic expansion.
  • “Energy-dependent Alaska and Wyoming were the only two states with growth rates of less than 1%, and
  • “Growth in government assistance—including payments from the extra pandemic aid, Medicare, Medicaid, Social Security, and other programs—exceeded an annualized 20% in a dozen states, after accounting for inflation. Massachusetts’ growth rate was the largest (29.4%), as the state provides more generous unemployment benefits than others, followed by Hawaii (28.1%), Nevada (27.3%), and California (26.8%).”

Below, a look at the growth rate over the last year — after accounting for inflation:

(Source: The Pew Charitable Trusts)

According to Pew, a comparison of inflation-adjusted state personal income in the second quarter of this year, compared to the second quarter of 2020, also showed that:

  • “California was the only state to record personal income growth (0.2%).
  • “The smallest declines in personal income were in Illinois, Nebraska, and Texas, all with growth rate drops of -0.7%.
  • “The sharpest declines were in Michigan (-9.5%), West Virginia (-9.3%), Vermont (-8.6%), Rhode Island (-8.1%), and Maine (-7%).
  • “Declines in government assistance growth rates ranged from 19% in Florida to 35.7% in Michigan,” and
  • “Among 14 states in which earnings exceeded 10%, North Dakota (14.9%) and Nevada (14%) registered the strongest growth.”

All this data matters, of course, because, as Pew notes, “not only because [they help states] assess the economic well-being of [their] residents but also because changes in residents’ income can signal that tax revenue and spending demands are apt to rise or fall, with repercussions for state budgets.”

Our news partners at City & State PA will recognize forty individuals under the age of 40, who have already distinguished themselves in their fields during a 6 p.m. reception on Nov. 16 at Level 2 in Harrisburg. The event features keynote remarks by House Minority Leader Joanna McClinton, D-Philadelphia, and additional remarks by state Reps. Patty Kim, D-Dauphin, and Jason Ortitay, R-Washington.

Our Stuff.
Gov. Tom Wolf was among the scores of Democratic luminaries who joined President Joe Biden at the White House on Monday as he signed the $1.2 trillion infrastructure bill into law. The whole Capital-Star Washington Bureau, with additional reporting from me, has the details, along with the full spread of Pennsylvania data and comment.

Democrats on the House Labor & Industry Committee staged a walk-out on Monday to protest legislation tightening public sector labor laws, Stephen Caruso reports.

The Pennsylvania Lottery needs to keep closer tabs on frequent winners, and state lawmakers should tighten the rules for retailers who play the Lottery, state Auditor General Tim DeFoor said Monday. Details from me.

The Pennsylvania Department of Health confirmed 14,001 new cases of COVID-19 in the commonwealth during the three-day period between 11:59 p.m. on Thursday and 11:59 p.m. on Sunday, I report.

Advocates, including the father of the late Jacob Blake, who was killed by police in Kenosha, Wisc., traveled to Philadelphia to talk police reform, our partners at the Philadelphia Tribune report.

A bipartisan bill now before the state Senate aims to allow Pa. lifers a chance at parole, our partners at Pittsburgh City Paper report.

On our Commentary Page this morning, Sen. Nikil Saval and Rep. Rich Krajewski, both Philadelphia Democrats, make the persuasive argument that bills that fill jails are the last bastion of bipartisanship in Harrisburg — and that we can do without them. And columnist Michael Coard, of our partners at the Philadelphia Tribune, says AT&T must cut its considerable ties with ultra-right wing One America News Network.

(c) Scott Van Blarcom – Stock.Adobe.com

Elsewhere.
An Inquirer analysis looks to get to what really happened in Pennsylvania and New Jersey on Election Day.

U.S. Rep. Brian Fitzpatrick, R-1st District, who’s facing backlash within his own party, explains why he voted for the infrastructure bill, the Inquirer also reports (via the Morning Call).

Pittsburgh’s public schools are at a critical inflection point, the Post-Gazette reports, citing a report by an education advocacy group.

Get ready for convenience store civil war: Wawa is closer to opening an outlet in HarrisburgPennLive reports. I’ll be sticking with Sheetz, thanks very much.

Officials in the Manheim Township Schools have voted to keep the district’s mask requirementLancasterOnline reports.

The York Daily Record takes a look at violence against high school sports referees (paywall).

Thousands of Pennsylvanians have had COVID-19 twice, the Times-Tribune reports, citing new state Health Department data (paywall).

Union boss John Dougherty and Philadelphia City Councilmember Bobby Henon have been convicted on federal bribery chargesWHYY-FM reports.

WITF-FM explains why it’ll take a while before federal infrastructure money starts flowing to Pennsylvania.

A rising number of Erie County schools are temporarily going remote because of increasing COVID-19 caseloads, GoErie reports.

City & State Pa. profiles House Minority Leader Joanna McClinton, D-Philadelphia.

As he implements the new infrastructure law, President Joe Biden is turning to two former mayors for helpRoll Call reports.

Here’s your #Philadelphia Instagram of the Day:

 

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What Goes On
The House comes in at 11 a.m. today.
8:30 a.m., 523 Irvis: House Health Committee
8:30 a.m., 515 Irvis: House State Government Committee
10 a.m., Hearing Room 1, North Office Building: Senate State Government Committee
12 p.m., Capitol Steps: Homelessness Awareness Month event
Call of the Chair, 140 MC: House Appropriations Committee

What Goes On (Nakedly Political Edition)
8 a.m.: Breakfast for Rep. Joe Hohenstein
8 a.m.: Breakfast for Rep. Nick Pisciottano
8 a.m.: Breakfast for Rep. Austin Davis
8 a.m.: Breakfast for. Rep. Mike Armanini
8 a.m.: Breakfast for Rep. Brett Miller
8 a.m.: Breakfast for Rep. Kate Klunk
5:30 p.m: Reception for Rep. Perry Warren
6 p.m.: Reception for Rep. Sue Helm
Ride the circuit, and give at the max, and you’re out a ridiculous $11,850 today.

WolfWatch
By the time some of you read this, Gov. Tom Wolf already will have done an 8:07 a.m. interview on KDKA-AM radio in Pittsburgh. And at 1 p.m., he holds a virtual newser with members of the Appalachian Regional Commission to announce grants helping people with substance abuse disorders.

Heavy Rotation
Here’s one from The Revivalists to power you through your Tuesday morning. It’s ‘All My Friends.’


Tuesday’s Gratuitous Hockey Link
Columbus bested the visiting Detroit Red Wings 5-3 on Monday night. The ‘Jackets’ Zach Werenski scored the go-ahead goal with 1:19 to go in the third period.

And now you’re up to date.

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John L. Micek
John L. Micek

A 3-decade veteran of the news business, John L. Micek is the Pennsylvania Capital-Star's Editor-in-Chief. An award-winning political reporter, Micek’s career has taken him from small town meetings and Chicago City Hall to Congress and the Pennsylvania Capitol. His weekly column on U.S. politics is syndicated to 800 newspapers nationwide by Cagle Syndicate. He also contributes commentary and analysis to broadcast outlets in the U.S., Canada and the U.K. Micek’s first novel, “Ordinary Angels,” was released in 2019 by Sunbury Press.

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