AZ Big Media Here’s how Arizona’s real income fell
Personal income growth in Arizona beat the nation in the second quarter, but lagged inflation.
Arizona’s personal income grew 6.6% at a seasonally adjusted annual rate before adjusting for inflation in the second quarter of 2022. This topped the national average of 5.8% and ranked the state ninth country rank (Piece 1). Connecticut posted the smallest increase in the second quarter (2.2%) and North Dakota posted the fastest (10.9%).
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Exhibit 1: Personal income by state, percent change at annual rate, 2022:Q1 – 2022:Q2
In the second quarter, Arizona’s personal income growth was led by net labor income, supported by strong contributions from dividends, interest, rents and transfers. Transfer receipts include Social Security, Medicare, Medicare, Welfare Assistance, Unemployment Insurance, and other government payments to households.
Over the year, Arizona’s nominal personal income rose 4.5% in the second quarter, driven by higher net labor income and higher dividends, interest and rents. Transfer receipts fell 5.6% during the year, reflecting the decline in federal income support related to the pandemic. Arizona’s revenue growth exceeded the national average increase of 3.4% for the year.
On an inflation-adjusted basis, Arizona personal income continued to decline in the second quarter of 2022. Using the Phoenix MSA Consumer Price Index (CPI-U), real personal income in Arizona Arizona fell 9.1% at a seasonally adjusted annual rate. in the second trimester. This was the fifth consecutive quarter-over-quarter decline on an inflation-adjusted basis (Piece 2).
Exhibit 2: Arizona real personal income, billions of dollars as of December 2001
With this release, the BEA has revised income data through 2017. The latest estimates put Arizona’s nominal per capita personal income (using their population estimate) at $55,487 in 2021, or 86 .5% of the national average of $64,143.
Arizona’s nominal per capita personal income rose 6.0% in 2021, from 8.7% in 2020. Income gains in both years were boosted by the huge federal income support tied to the pandemic. Arizona’s per capita income growth was well below that of the United States in 2021 (7.3%).
Arizona’s per capita disposable income (after tax, before adjusting for inflation) was $49,555 in 2021, 88.3% of the nation (at $56,130). Arizona’s disposable income grew 4.7% in 2021, up from 9.7% in 2020 and below the United States at 5.9%.
George W. Hammond, Ph.D., is director and research professor at the Economics and Business Research Center (EBRC).