Which States Saw the Biggest Income Boost? The Answer Might Surprise You
Call it a comeback for the Rust Belt.
People in the same states that suffered crippling job and income losses as the U.S. manufacturing industry declined are starting to make more money.
That’s according to the latest personal income numbers released by the U.S. Bureau of Economic analysis (and a Penny Hoarder look at changes over the last year, rather than just the last quarter).
Indiana, Pennsylvania and Michigan are among the big winners in growth in personal income, for a variety of reasons.
Perhaps an increase in residential construction jolted jobs and pay in the building industry, an Amazon sorting or fulfillment center went on a hiring spree, or tourism and the arts had a strong showing. (Yes, tourists visit the Rust Belt, too.)
Surprised? We aren’t, considering most of these states have a city or several on our list of the best places for millennials to relocate.
Here are some states you might want to consider moving to if you want to ride that sweet, sweet cash wave coming in.
Personal Income Has Grown in States You Might Not Expect
When you think of high-growth states where everyone wants to move, Florida, New York and California are the places that most come to mind, right?
Well, when it comes to the growth in wages or other income, they don’t end up at the top of the list.
We used the year-over-year change in quarterly per capita income (a fancy way of saying individual earnings) for the second quarter of this year and the same period in 2016, to determine the top states in personal income growth.
We also looked at which specific job types or industries were driving earnings growth to see what the heck was going on. Here’s what we found.
Earnings in the construction industry jumped 10.1% from the second quarter of 2016 to the same timeframe this year to a little more than $13.1 million.
Growth in employer contribution to pensions (6.6%) and total pay in the arts, entertainment and recreation sectors (9.5%) were also big drivers of the change. Who knew Indiana had such a cultural knack?
Ah, Delaware. The state where nearly every corporation is incorporated.
It shows in what’s driving the growth this year: A 19.2% increase in earnings for the management of companies and enterprises industry. Construction earnings also saw a significant bump, increasing 10.1%.
And, although it’s a miniscule piece of Delaware’s economy, earnings for farmers grew 9%.
It’s a dirty job, but someone’s got to do it. And Georgia is doing it well.
Waste management and remediation earnings grew 9.6% over the last year, followed by an 8.2% increase in overall earnings by those in the transportation and warehousing sector.
In Michigan, a former Rust Belt powerhouse, earnings in the transportation and warehousing sector (Hi again, Amazon!) grew at nearly double the pace of manufacturing with an 8% increase this year compared with 4.7% for the latter.
But, like Delaware, much of the recent growth was fueled by a 12.1% jump in wages in the management of companies and enterprises. Boring.
And finally, we come to Pennsylvania.
It may not seem like the sexiest state, but it landed in the top five states in terms of earnings growth thanks to, again, the Amazon effect.
Transportation and warehousing earnings increased 6% in the second quarter of this year. And again, in a nonfarm state, farm earnings jumped 30%.
State Personal Income in These Areas Barely Budged Over the Last Year
Where there are winners, there are inevitably losers.
Using the same method as above, we wanted to find the states you should run from right now. Seriously, pack your bags and jump on the soonest cheap flight you can find, because these states had the lowest percentage change in income.
- North Dakota: -0.6%
- South Dakota: 0.2%
- Oklahoma: 0.4%
- Iowa: 0.4%
- Nebraska: 0.6%
OK, so if you live in one of these states you don’t necessarily have to leave — just learn a few awesome ways to put money in your bank account this year.
And who knows, there’s always next quarter for a comeback.
Alex Mahadevan is a data journalist at The Penny Hoarder. One more hurricane, and he’ll probably be ready to leave Florida for one of the top five.