U.S. DEPARTMENT OF COMMERCEWilliam M. Daley, Secretary
ECONOMICS AND STATISTICS ADMINISTRATIONRobert J. Shapiro, Under Secretary for Economic Affairs
BUREAU OF ECONOMIC ANALYSISJ. Steven Landefeld, DirectorRosemary D. Marcuss, Deputy Director
U.S. DEPARTMENT OF COMMERCE
BUREAU OF ECONOMIC ANALYSIS
MAY 1999
STATE PERSONAL INCOME1929–97
Acknowledgments
The estimates of State personal income were prepared bythe Regional Economic Measurement Division under thedirection of Robert L. Brown, Chief. Hugh W. Knox,Associate Director for Regional Economics, providedgeneral guidance.
The estimates of nonfarm wages and salaries and otherlabor income and of personal tax and nontax paymentswere prepared by the Regional Wage Branch under thesupervision of Sharon C. Carnevale, Chief. Major re-sponsibilities were assigned to Elizabeth P. Cologer, LisaC. Ninomiya, Michael G. Pilot, John A. Rusinko, andJames M. Scott. Contributing staff members were SusanP. Den Herder, Ann E. Dunbar, Lisa B. Emerson, JohnD. Laffman, Lela S. Lester, Russell C. Lusher, RichardA. Lutyk, Paul K. Medzerian, Mauricio Ortiz, MichaelPhillips, Adrienne T. Pilot, William E. Reid, Jr., VictorA. Sahadachny, Elizabeth F. Stell, and Jaime Zenzano.
The quarterly estimates of State personal income andthe annual estimates of farm wages and salaries andother labor income and of proprietors’ income, prop-erty income, transfer payments, personal contributionsfor social insurance, and the adjustment for residencewere prepared by the Regional Income Branch under thesupervision of James M. Zavrel, Chief. Major respon-sibilities were assigned to Charles A. Jolley and MarianB. Sacks. Contributing staff members were Elaine M.Briccetti, Carrie L. Case, Daniel R. Corrin, Toan A. Ly,W. Tim McKeel, Jeffrey L. Newman, Suet M. Ng, JamesP. Stehle, Matthew A. von Kerczek, Ellen M. Wright, andMarianne A. Ziver.
The public use tabulations and data files were assem-bled and the tables and text for this publication were
prepared by the Regional Economic Information SystemBranch under the supervision of Kathy A. Albetski, Chief.Gary V. Kennedy guided the preparation of the mate-rials for the publication, and Wallace K. Bailey wrotethe text. Contributing staff members were H StevenDolan, Michael J. Paris, Albert Silverman, Nancy E.Smith, Callan S. Swenson, Monique B. Tyes, and MaryC. Williams.
M. Gretchen Gibson of Publication Services in theCurrent Business Analysis Division coordinated the pro-duction of this publication. Eric B. Manning edited thetext and typeset the tables. Laura A. Oppel typeset thetext. Ms. Oppel and W. Ronnie Foster prepared thecharts, and Mr. Foster designed the cover and the titlepage.
In addition, other government agencies and private or-ganizations provided the source data for the estimates.The contributions of the following organizations wereparticularly noteworthy: The State employment secu-rity agencies, the State agencies that administer incomemaintenance programs, the Bureau of Labor Statisticsand the Employment and Training Administration of theDepartment of Labor, the Bureau of the Census, the Na-tional Agricultural Statistics Service and the EconomicResearch Service of the Department of Agriculture, theInternal Revenue Service, The Social Security Admin-istration, the Health Care Financing Administration, theOffice of the Secretary of Defense, the Office of Person-nel Management, the Department of Veterans Affairs, theRailroad Retirement Board, and the National Council onCompensation Insurance.
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Introduction
This publication presents the State estimates of personalincome that were prepared by the Regional EconomicMeasurement Division of the Bureau of Economic Analy-sis (BEA). It presents, in the statistical section that followsthis text, the following estimates for each State, for theeight BEA regions, and for the United States:
• Annual estimates of personal income and per capitapersonal income for 1929–97 (pages 6–16);
• Annual estimates of disposable personal income andper capita disposable personal income for 1948–97(pages 17–25);
• Annual estimates of personal income by major com-ponent and of labor and proprietors’ earnings by Stateof work and by industry, together with the derivationof personal income by place of residence for 1929–97(pages 36–394); and
• Quarterly estimates of total personal income for1969–97 (pages 26–34).
These estimates are supplemented by maps and charts.The maps show the State distributions of per capita per-sonal income in 1929 and in 1997. The charts show thefollowing: Per capita personal income for the regionsas a percent of the same measure for the United Statesfor 1929–97; per capita personal income for the UnitedStates, for each region, and for each State for selectedyears in 1929–97; and the composition of total personalincome for the United States, for each region, and foreach State for selected years in 1977–97.
The estimates of personal income and of per capitapersonal income reflect the revised national estimates ofpersonal income that resulted from the 1996 comprehen-sive revision of the national income and product accounts(NIPA’s) and from the annual NIPA revisions that werereleased in 1996, 1997, and 1998. The 1996 comprehen-sive and annual revisions of the NIPA’s were incorporatedinto the State estimates of personal income as part of acomprehensive revision of the State estimates in October1996. The 1997 and 1998 annual NIPA revisions wereincorporated into the State estimates as part of annual re-visions to the State estimates that were released in 1997and 1998, respectively.
The estimates are first prepared for the Nation andthen for the States. The estimates for the regions areaggregations of the State estimates.
This introduction presents a brief history of the devel-opment of the estimates of personal income. It describesthe uses of the State estimates and the schedule for prepar-ing and revising the estimates, and it presents informationabout the availability of the estimates and about the BEAUser Group.
A brief history
In the mid–1930’s, BEA began work on the estimationof regional income as part of the effort to explain theprocesses and structure of the Nation’s economy. As aresult, it produced annual State estimates of total “incomepayments to individuals.” These income payments werecalculated as the sum of (1) wages and salaries, (2) otherlabor income and relief, (3) entrepreneurial withdrawals,and (4) dividends, interest, and net rents and royalties.
During the 1940’s and early 1950’s, BEA developedan integrated set of national economic accounts, soughtadditional source data, and improved the methods usedto prepare the estimates. One result of this work was thedevelopment of State personal income—a measure thatis more comprehensive than State income payments.
State personal income differs significantly from Stateincome payments in five ways:
• State personal income consists of six major com-ponents (other labor income and transfer paymentsreplaced other labor income and relief, and the com-ponent personal contributions for social insurancewas added as an explicit deduction);
• Personal income includes more component detailand a broader range of income-in-kind and imputedincome items than State income payments;
• Personal income includes the income of nonprofitinstitutions that serve individuals and of privatenoninsured welfare funds and private trust funds;
• Personal income includes employer contributionsto private pension funds—as part of other laborincome—instead of the benefits paid by the funds;and
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• Personal income includes transfer payments bybusiness.
In addition, in the mid–1950’s, BEA began work onpreparing estimates for local areas. It prepared estimatesfor a few counties in the States in the Mideast and Plainsregions.
In the late 1950’s, BEA developed estimates of Statedisposable personal income. This series was publishedoccasionally in the SURVEY OF CURRENT BUSINESS inthe 1960’s and 1970’s and has been presented annuallybeginning with 1982.
During the 1960’s, BEA developed quarterly estimatesof State personal income. The first set of these estimatesas a continuous series was published in the December1966 issue of the SURVEY. In addition, BEA prepareda personal income series for metropolitan areas and fornonmetropolitan counties for selected years in 1929–62.
In the early 1970’s, BEA developed the estimatesof personal income for counties in metropolitan areas.These estimates were published for the first time inthe April 1975 SURVEY. Later in the 1970’s, it devel-oped estimates of employment for States, counties, andmetropolitan areas.
In the 1980’s, BEA developed estimates of gross Stateproduct by industry. These estimates, as an establishedseries, were first presented in the May 1988 SURVEY.
Now, BEA prepares annual and quarterly estimates ofState personal income and annual estimates of State dis-posable personal income and employment and of grossstate product. It also prepares annual estimates of per-sonal income and employment for all metropolitan areasand all the counties and county equivalents for whichreliable source data are available.
Uses of the State estimates
The State estimates of personal income and its com-ponents, of per capita personal income, of disposablepersonal income, and of gross state product are widelyused by both the public and the private sectors to measureand to track the levels and the types of incomes that arereceived by the people who live or work in a State andthe value-added that a State’s industries produce. Theseestimates provide a framework for the analysis of eachState’s economy, and they serve as a basis for decisionmaking.
Federal agencies use these estimates in econometricmodels, such as those used to project energy and wateruse; they also use the estimates as a basis for allocatingfunds and for determining matching grants. For example,in fiscal year 1996, the distribution of $122 billion inFederal funds was affected by the estimates of State per
capita personal income. The estimates of gross stateproduct are also used in the funds allocation formula forone program.
In addition, the Census Bureau uses the estimates ofState per capita personal income as the key predictorvariable in the preparation of State estimates of the meanannual income for four-person families.
State governments use the estimates of personal incomeand gross state product to measure the economic baseof State planning areas. They also use the estimates ineconometric models that are developed for various plan-ning purposes and to project tax revenues and the need forpublic utilities and for services. Currently, 17 States haveset constitutional or statutory limits on State governmentrevenues and spending that are tied to State personal in-come or to one of its components. These States accountfor almost one-half of the population of the United States.A majority of the States use the quarterly estimates ofState personal income to project tax collections.
University schools of business and economics use theestimates for theoretical and applied economic research.Some of these schools distribute the estimates in abstractsor similar reports to various State and local govern-ment agencies, regional councils of governments, privateresearch groups, businesses, and libraries.
Businesses use the estimates for planning activities,such as evaluating markets for new or established prod-ucts and determining areas for the location, expansion,and contraction of their activities.
Release and publication schedules
The quarterly and annual estimates of State personalincome and the annual estimates of local area per-sonal income are first released on BEA’s Web site at<www.bea.doc.gov> and in news releases; the releasedates are announced in advance and are listed on the Website and in the SURVEY OF CURRENT BUSINESS.
The quarterly State estimates of total and nonfarm per-sonal income are subsequently published in the February,May, August, and November issues of the SURVEY.
The preliminary annual State estimates of total andper capita personal income and of total and per capitadisposable personal income are published in the MaySURVEY. The revised annual estimates of State personalincome by major type and of earnings by industry arepublished in the September or October SURVEY.
The local area estimates of total and per capita personalincome are published in the May SURVEY.
STATE PERSONAL INCOME, 1929–97 M–3
and Product Accounts of the United States, 1929–94: Volume 1 and Volume 2(Washington, DC: U.S. Government Printing Office, April 1998).
2. BEA’s major national, regional, international, and industry estimates,recent issues of the SURVEY, and BEA news releases are available on BEA’sWeb site: Go to <www.bea.doc.gov>.
In addition, STAT-USA maintains an electronic bulletin board (EBB)and a Web site, which contain BEA estimates, BEA news releases, andthe SURVEY. To subscribe to STAT-USA’s World Wide Web system, go to<www.stat-usa.gov> or call (202) 482–1986.
3. See the ads at the end of the publication. See “Appendix A: Availability of
Preparation and revision schedules
The quarterly estimates of State personal income are pre-pared about 4 months after the end of the quarter. Thepreliminary annual State estimates are prepared about 4months after the end of the year, and the revised Stateestimates are prepared about 8 months after the end of theyear. The annual estimates of local area personal incomeare prepared about 16 months after the end of the year.
In January, the estimates of State personal income forthe third quarter of the previous year are prepared, andthe estimates of the first and second quarters are revised.
In April, the annual and quarterly State estimates for the3 years before the previous year are revised in order to in-corporate the newly available data for wages and salariesthat are used to prepare the county estimates for thoseyears and to reflect the county-level estimation of the ad-justment for residence. In addition, the State estimatesfor the fourth quarter of the previous year are prepared,and the estimates for the first three quarters are revised;the preliminary annual State estimates for the previousyear are prepared by averaging these quarterly estimates.
In May, the estimates of local area personal income forthe year before the previous year are prepared, and theestimates for the 2 years before that are revised.
In July, the State estimates for the first quarter of thecurrent year are prepared, and the estimates for the fourquarters of the previous year are revised.
In August or September, the annual State estimates forthe previous year are revised using the annual, rather thanthe quarterly, methodology, and the annual estimates forthe 2 years before that are revised.
In October, the State estimates for the second quarterof the current year are prepared, and the estimates for thefirst quarter are revised. Further, the estimates for thequarters of the previous 3 years are revised for consistencywith the revised annual estimates that were released inAugust or September.
The State and local area estimates are normally re-vised again only after a comprehensive, or benchmark,revision of the national income and product accounts(NIPA’s). Comprehensive revisions of the NIPA’s aremade approximately every 5 years.1
1. For the results of the latest comprehensiverevision of the NIPA’s, see Bu-reau of Economic Analysis, U.S. Department of Commerce, National Income
In a comprehensive NIPA revision, the national esti-mates of personal income are affected by the statisticalchanges that result from the introduction of new sourcedata and the use of improved estimating methods. Thenational estimates may also be affected by the definitionaland classificational changes that are made so that theNIPA’s will reflect the evolving economy of the UnitedStates. For example, as part of the 1985 comprehensiverevision, the payments to vendors of medical servicesunder the medicaid program were reclassified from gov-ernment purchases to transfer payments; as a result, thesepayments are now classified as part of personal incomefor all the years that the program has existed.
Availability of the State and local area estimates
Before the State and local area estimates are publishedin the SURVEY, they are available in printed and elec-tronic news releases.2 More detailed estimates than theestimates published in the SURVEY are available on theCD–ROM State Personal Income, 1929–97 and, for thelocal area estimates, on the CD–ROM Regional EconomicInformation System, 1969–97.3
In addition, the State and local area estimates of per-sonal income and of employment are available from theBEA User Group. The members of this group includeState agencies, universities, and Census Bureau PrimaryState Data Centers.4 The members have agreed to providethe estimates that they receive from BEA to other users intheir State; they can provide the estimates for their Stateand sometimes for other States.
the Data and Sample Tables from the RegionalEconomic Information System.”4. See “Appendix B: Members of the BEA User Group.”
The Sources and Methods for the Annual Estimates of State
Personal Income and Disposable Personal Income, 1991–97
This text describes the sources of the data and the meth-ods that were used to prepare the annual estimates of thecomponents of personal income and disposable personalincome for States for 1991–97.1
The introduction describes the relationship between thenational estimates of personal income and the State esti-mates, it defines the essential terms used, and it explainsthe major differences between the definitions and classifi-cations used in the national estimates and those used in theState estimates. This introduction also includes generalinformation about the sources of the data that are used toprepare the estimates and the place of measurement of thesource data. Additionally, it includes information aboutthe procedure used to integrate the national and the Stateestimates—the allocation procedure—and a brief descrip-tion of the procedures used to prepare estimates for whichdirect source data for some years are not available—theinterpolation and extrapolation procedures.
After the introduction, the text provides specific infor-mation about the sources and methods used to preparethe estimates of each component of personal income, ofthe residence adjustment, and of personal tax and nontaxpayments.
Introduction
The State estimates of personal income and disposablepersonal income are designed to be conceptually andstatistically consistent with the national estimates of per-sonal income and disposable personal income; as partof the preparation of the State estimates, the nationalestimates are disaggregated to States.2 As a result, thedefinitions that are used for the components of personal
1. For information about the methodology used to prepare the estimates forearlier years, call (202) 606–9241, or E-mail [email protected].
2. At the national level, personal income and disposable personal incomeare parts of the personal income and outlay account, which is one of fiveaccounts that compose the national income and product accounts.
Of the aggregations in the personal income and outlay account, onlypersonal income, disposable personal income, and personal tax and nontaxpaymentsare estimated for States. In addition, BEA preparesestimates of grossstate product (GSP), which correspond to gross domestic product (GDP); GSPand State personal income share the following elements of personal income:
and disposable personal income for the State estimatesare essentially the same as those used for the nationalestimates.3
State personal income is defined as the income receivedby, or on behalf of, all the residents of the State. It consistsof the income received by persons from participation inproduction, from both government and business transferpayments, and from government interest (which is treatedlike a transfer payment). Personal income is the sumof wage and salary disbursements, other labor income,proprietors’ income with inventory valuation and capitalconsumption adjustments, rental income of persons withcapital consumption adjustment, personal dividend in-come, personal interest income, and transfer payments topersons, less personal contributions for social insurance.
Persons consists of individuals, nonprofit institutionsthat serve individuals, private noninsured welfare funds,and private trust funds. In this text, the last three arereferred to as “quasi-individuals.” The State-level sourcedata used to prepare the estimates of some componentsof personal income received by individuals are not themost appropriate source data for estimating the incomereceived by quasi-individuals.
State per capita personal income is calculated as thepersonal income of the residents of the State divided bythe population of the State as of July 1.
Disposable personal income is the income that is avail-able to persons for spending and saving. It is calculatedas personal income less the sum of personal tax paymentsand personal nontax payments to Federal, State, and localgovernments.
Wage and salary disbursements, other labor income, proprietors’ income, andrental income of persons.
For information about the relationships among GDP, GSP, and Statepersonal income, see Howard L. Freidenberg and Richard M. Beemiller, “Com-prehensive Revision of Gross State Product by Industry, 1977–94,” SURVEY OF
CURRENT BUSINESS 77 (June 1997): 15–41.3. The national estimates may temporarily differ from the State estimates
because of different estimating schedules. The State estimates of wages andsalaries and farm proprietors’ income incorporate source data that are not avail-able when the national estimates are prepared; these data are later incorporatedinto the national estimates when they are revised.
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