Personal Income Seeing Slight Growth

Personal income for the nation, which is measured only in current dollars, grew 0.8 percent in the second quarter of 2003, the same as in first quarter and up slightly from the 0.6 percent increase of the fourth quarter of 2002. According to estimates released today by the U.S. Bureau of Economic Analysis, six of the ten fastest growing states were in the Plains and Rocky Mountain regions while 4 of the 10 slowest-growing states were in New England and all of the Great Lakes states were in the bottom two quintiles.



Nationally, earnings grew in every industry except durable goods manufacturing and leisure and hospitality. Financial activities accounted for 0.28 of the 0.8 percent growth in earnings and contributed the most to earnings growth in 24 states.

Because quarter-to-quarter changes in state personal income are subject to large swings, it is also useful to look at the change in state personal income in the current quarter relative to the same quarter a year ago. Chart 2 shows the year-to-year growth rates of quarterly state personal income from the second quarter of 2000 through the second quarter of 2003.

Year-to-year growth in personal income was higher in the top-quintile states than in the bottom-quintile states in eight of the past nine quarters. In addition, the growth rate of the top quintile increased steadily in the past two quarters whereas the bottom quintile grew more slowly in the second quarter of 2003 than in the first quarter.



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