Combined personal income is on the increase in 49 states, according to data from the Pew Charitable Trusts.
“Over the past year, this key economic indicator recorded widespread gains, rising in all states except Rhode Island as of the fourth quarter of 2018,” Pew reports.
Combined personal income reflects multiple forms of income received by all residents, not just paychecks. For example, it includes Social Security benefits, employers’ contributions to retirement plans and health insurance, and benefits from government programs like Medicare.
But which states saw the most dramatic increase in combined personal income during 2018?
To answer that question, Pew analyzed data from the Bureau of Economic Analysis, a division of the U.S. Department of Commerce. Expansion of personal income over the past year was widespread across the country, not in any one region, Pew found.
In fact, Pew’s analysis found that personal income totals have bounced back in all states since 2007, the start of the Great Recession, but have grown at far different rates since that benchmark.
Following are the 13 states that saw the biggest increases in combined personal income over the past year. We have ranked them based on those increases.
13. Tennessee
Growth rate of combined personal income over the past year: 2.8%
Annual growth rate of combined personal income since the fourth quarter of 2007: 2.2%
Over the past couple of years, Tennessee has seen its median household income grow at a rate that beats the growth in other states in the Southeast. Gov. Bill Haslam credits the income growth to the establishment of higher-paying jobs becoming available in Tennessee.
The state’s unemployment rate is also low: 3.2% as of April — compared with 3.6% for the nation as a whole.
12. Minnesota
Growth rate of combined personal income over the past year: 2.8%
Annual growth rate of combine personal income since the fourth quarter of 2007: 1.9%
In Minnesota, a number of areas saw above-average income growth in 2018. For example, Grant County saw the best income growth rate at 4.2%, according to SmartAsset.
The unemployment rate is also relatively low in Minnesota: 3.3% as of April, compared with 3.6% nationwide.
11. Florida
Growth rate of combined personal income over the past year: 3.0%
Annual growth rate of combined personal income since the fourth quarter of 2007: 1.9%
Earnings in two industries in particular contributed the most by far to the increase in personal income that the Sunshine State experienced last year, according to data from the Bureau of Economic Analysis, a division of the U.S. Department of Commerce.
The construction industry as well as the professional, scientific and technical services industry each accounted for 0.47 percentage points of the increase in Florida’s personal income in 2018.
10. Texas
Growth rate of combined personal income over the past year: 3.4%
Annual growth rate of combined personal income since the fourth quarter of 2007: 2.8%
Even though the Texas economy continues to grow at a solid pace, the Dallas Fed warns that the recent expansion is starting to slow, due in part to the slower growth in the manufacturing sector.
9. Nevada
Growth rate of combined personal income over the past year: 3.5%
Annual growth rate of combined personal income since the fourth quarter of 2007: 1.5%
Nevada continues to have a relatively low unemployment rate, at 4% as of April 2019. The leisure and hospitality industry accounts for the greatest number of jobs in Nevada as of April. It’s followed by a category that includes trade, transportation and utilities jobs
8. Colorado
Growth rate of combined personal income over the past year: 3.5%
Annual growth rate of combined personal income since the fourth quarter of 2007: 2.7%
While not the biggest industry in the state by a long shot, the Kansas City Fed recognizes that the marijuana industry contributed to about 5.4% of employment growth in Colorado between January 2014, when its use was legalized in the state, and 2018. The pot industry has resulted in more than $6.5 billion in sales since 2014, and tax revenue grew by almost 8% in 2018.
7. Utah
Growth rate of combined personal income over the past year: 3.6%
Annual growth rate of combined personal income since the fourth quarter of 2007: 3.0%
Utah continues to show economic strength, according to a report from Wells Fargo, due to a young and educated workforce and the fact that business, labor and government work well together in the state. Jobs in areas such as cloud computing, software development, aerospace and life sciences are part of the state’s economic growth.
6. Arizona
Growth rate of combined personal income over the past year: 3.7%
Annual growth rate of combined personal income since the fourth quarter of 2007: 1.7%
Arizona’s current expansion looks to be continuing, according to economic analysis. In fact, the state is expected to add more jobs over the next couple of years, and the median household income in Arizona is rising faster than the national average.
5. Iowa
Growth rate of combined personal income over the past year: 4.0%
Annual growth rate of combined personal income since the fourth quarter of 2007: 1.5%
With a super-low unemployment rate of 2.4% as of April, it appears that Iowans can find work if they wish. Trade, transportation and utilities, along with government service, are among the job categories with a high level of employment.
4. West Virginia
Growth rate of combined personal income over the past year: 4.1%
Annual growth rate of combined personal income since the fourth quarter of 2007: 1.2%
West Virginia was the only state that didn’t see a tumble in combined personal income after 2007; it alone avoided any calendar-year drop during the 18-month Great Recession. In the past year, the state has seen a solid spike in income, due in part to higher coal prices in a state known for its coal mining.
3. Washington
Growth rate of combined personal income over the past year: 4.2%
Annual growth rate of combined personal income since the fourth quarter of 2007: 2.9%
Washington’s place on this list stands out, as it is the only state to have ranked among the top three states for combined personal income growth in each of the past four quarters. Additionally, Washington is one of the states with the fewest decreases in personal income since 2007, only dropping in 2009.
2. South Dakota
Growth rate of combined personal income over the past year: 4.4%
Annual growth rate of combined personal income since the fourth quarter of 2007: 1.8%
Even though personal income spiked 4.4% last year, the tough farm economy is weighing on the economy in South Dakota, according to the Minneapolis Fed. However, there are some areas of the state where there is still growth, like Sioux Falls and Rapid City.
1. North Dakota
Growth rate of combined personal income over the past year: 4.4%
Annual growth rate of combined personal income since the fourth quarter of 2007: 3.3%
North Dakota has been seeing strong income growth since the recession, although incomes took a hit for three years due to falling oil prices in 2014 and 2015. Much of North Dakota’s income growth since the recession — and in 2018 — can be attributed to drilling technologies that have resulted in an oil boom in the state.
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