California personal income growth below national average

State personal income increased 3.4 percent at an annual rate in the first quarter of 2019, a deceleration from the 4.1 percent increase in the fourth quarter of 2018, according to estimates released by the Bureau of Economic Analysis. Personal income increased in all states except South Dakota. The percent change in personal income across all states ranged from 5.6 percent in West Virginia to -0.6 percent in South Dakota.

Increases in earnings and transfer receipts contributed to personal income growth nationally and in most states, while property income (dividends, interest, and rent) decreased in every state.

Earnings. Earnings increased 2.8 percent in the first quarter of 2019, after increasing 3.2 percent in the fourth quarter of 2018. Earnings increased in 20 of the 24 industries for which BEA prepares quarterly estimates.

  • Construction was the leading contributor to the earnings increase in West Virginia, the fastest growing state.
  • Healthcare and social assistance was the leading contributor to the earnings increase in the next three fastest growing states-Arizona, Maine, and Florida.
  • Farming was the leading contributor to the earnings increase in New Mexico-the fifth fastest growing state.

For the nation, healthcare and social assistance; professional, scientific, and technical services; and state and local government were the leading contributors to overall growth in earnings.

Transfer receipts. Transfer receipts increased 15.5 percent for the nation in the first quarter of 2019, after increasing 3.9 percent in the fourth quarter of 2018. The increase in transfer receipts was due to an increase in refundable tax credits (the child tax credit and the Affordable Care Act premium tax credit), and a 2.8 percent cost of living increase in Social Security benefits. Growth in transfer receipts ranged from 24.2 percent in Utah to 4.7 percent in New York.

Property income. Property income decreased 4.3 percent for the nation in the first quarter of 2019, after increasing 7.3 percent in the fourth quarter of 2018. Property income declined in every state, ranging from -0.4 percent in Hawaii to -6.9 percent in California.

This article was released by the Bureau of Economic Analysis.

Courtesy photo.