Real State Per capita Income

The Bureau of Economic Analysis has been working on creating state and metro cost of living indices for several years and they have just published a new set of them that can be used to create real per capita income comparisons between states.

In their press release they show a map comparing real growth in 2012 that ranged from plus 12.7% in North Dakota and minus -2.3% in South Dakota.

http://www.bea.gov/newsreleases/regional/rpp/rpp_newsrelease.htm

But I found the ranking of the states real per capita income much more interesting.

Technically, the District of Columbia has the highest real per capita income but I suspect that measure is distorted the same way the D.C. real GDP is distorted.  Many people work in D.C.,  but commute in from other states. Because they live elsewhere they are counted in those states population, but their income or output generated in D.C. is included in the D.C data.  Interestingly, Luxemburg has the same distortion that gives it the highest real per capita GDP in Europe.

BEA had published some preliminary results from this for 2005.  The biggest change from that data appears to be New York moving from near the bottom of the ranking to number 15 and Texas falling from number 15th in rank to number 24th. Deleware fell from number 1 to number 28th in rank. I suspect that the major reasons for these rank changes stemmed from improvements in the data and methodology since BEA did the 2005 calculations.

 

Differences in rent is the major factor driving the differences in the cost of living by state.  For example, the Massachusetts price index is  index is 107.2 and within that rent is  121.4.  In Mississippi,  in contrast the overall price index is 86.4 and the rent index is 62.1.  So the difference in the overall index is about 14 while the rent index spread is about 60.  Rent in Massachusetts is approximately double rent in Mississippi.  Mississippi has the lowest rent in the country while Hawaii is the highest at 159. Hawaii has the second highest overall cost of living at 117.2 compared to 118.2 in Washington, D.C..  Only 14 states regional price indices are  greater than 100.

 

Real per capita income in the top ten states is 135% of that in the bottom ten states.

 

I stick with my long time comments that Massachusetts is 120% of the national average and Mississippi is 89% of the national average,  but the republicans/libertarians keep trying to tell us that we would be better off is we were more like Mississippi and less like Massachusetts.

 
Real Per Capita Personal Income
Chained (2008) dollars
…………………………………………rank…….. % of US
$41,282 United States
$59,759 District of Columbia………………….145
$57,367 North Dakota…………. 1…………… 139
$51,559 Connecticut……………. 2……………125
$49,587 Wyoming……………….. 3………….. 120
$49,355 Massachusetts………… 4 …………..120
$48,627 South Dakota…………. 5 ……………118
$47,188 Nebraska………………. 6……………. 114
$46,376 Iowa …………………….7……………. 112
$45,702 Maryland……………… 8……………. 111
$45,552 New Jersey……………. 9……………. 110
$45,494 Minnesota…………… 10……………. 110 ……..117.9 average of first ten states
$45,217 Kansas………………… 11……………. 110
$44,314 Virginia………………. 12 …………… 107
$43,905 Rhode Island………. 13……………. 106
$43,722 New Hampshire…… 14……………. 106
$43,603 New York…………… 15……………. 106
$43,601 Alaska……………….. 16……………. 106
$43,173 Pennsylvania………. 17…………… 105
$43,063 Illinois………………. 18……………. 104
$42,846 Wisconsin………….. 19 …………….104
$42,701 Oklahoma………….. 20…………… 103………..105.7  average of second ten states
$42,559 Colorado…………… 21……………. 103
$42,427 Ohio…………………. 22…………… 103
$42,164 Washington……….. 23…………… 102
$41,961 Missouri ……………24 ……………..102
$41,733 Texas………………. 25…………….. 101
$41,726 Vermont………….. 26 ………………101
$41,432 Louisiana………… 27……………… 100

$41,282 United States………………………… 100

$40,848 Delaware………… 28………………… 99
$40,371 Tennessee………. 29………………… 98
$39,553 Indiana…………… 30………………… 96………101.5 average of middle ten states
$39,225 Florida…………… 31…………………. 95
$39,103 North Carolina…. 32………………… 95
$38,888 California……….. 33 ………………….94
$38,665 Montana………… 34…………………. 94
$38,530 Alabama……….. 35…………………. 93
$38,516 Maine…………… 36 …………………..93
$38,479 Georgia………… 37………………….. 93
$38,317 Michigan ………..38…………………. 93
$38,224 Arkansas ……….. 39………………… 93
$37,909 Kentucky………. 40…………………. 92……………93.5 average of fourth set of  ten states
$37,451 Oregon………….. 41 …………………..91
$37,425 West Virginia….. 42 ………………….91
$36,803 Mississippi……… 43………………… 89
$36,769 Nevada………….. 44………………… 89
$36,507 South Carolina… 45………………… 88
$36,087 Hawaii…………… 46………………… 87
$35,553 New Mexico…… 47…………………. 86
$34,905 Arizona………… 48………………….. 85
$34,819 Idaho ……………49………………….. 84
$34,580 Utah……………. 50………………….. 84……………..87.4 average of bottom ten states

$59,759 Maximum
$34,580 Minimum
$25,179 Range

$41,282 United States

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