Oregon’s Per Capita Personal Income 2019

by Sarah Cunningham

October 2, 2020

Oregon’s total personal income ranked 25th in the nation in 2019, unchanged from its 2018 rank. Data on personal income comes from the Bureau of Economic Analysis – a division of the U.S. Department of Commerce.

State personal income captures total income within a state and is the sum of three main components: net earnings (wages, salaries, employer contributions); personal current transfer receipts (retirement, Medicare, unemployment insurance); and dividends, interest, and rent.

Growth in personal income for the U.S. overall averaged 3.9 percent in 2019, slightly lower than the previous year’s growth rate of 4.5 percent. For individual states in 2019, growth ranged from a 2.0 percent increase in West Virginia to a 5.8 percent increase in Utah. Personal income grew by 4.2 percent in Oregon in 2019, which was the 11th fastest in the nation (tied with Maine and New Mexico).

Per Capita Personal Income

The size of a state’s population plays a predominant role in the size of its personal income. California, Texas, Florida, New York, Pennsylvania, and Illinois – six of the most populous states in the nation – are also the top six states in terms of total personal income. South Dakota, North Dakota, Alaska, Vermont, and Wyoming – five of the least populous states in the nation – are also the bottom five states in terms of total personal income.

By dividing a state’s total personal income by its total population, we obtain per capita personal income (PCPI). This gives us a number that is more easily compared with other states. For instance, Oregon’s total personal income was just over $224 billion in 2019, while Texas had income of more than $1.5 trillion. Per capita personal income, however, was $53,191 for Oregon and $52,813 for Texas.

Adjusting to PCPI adjusts the income rankings of states as well. Connecticut ranked 23rd in total personal income and 29th in population but ranked first in the nation in PCPI. Mississippi ranked 34th in population and 35th in total personal income, but Mississippi ranked last of the states in PCPI. Oregon ranked 27th in population, 25th in total personal income, and ranked 25th in per capita personal income.
Comparison of PCPI Components

For the United States as a whole, 63 percent of PCPI came from net earnings in 2019. Connecticut took the top slot ($50,016) and Mississippi took the bottom ($22,358) in dollar value of per capita net earnings. For Connecticut, 64.7 percent of PCPI came from net earnings and for Mississippi, it was 57.5 percent. Oregon ranked 27th among the states in per capita net earnings ($31,935), which accounted for 60.0 percent of the state’s PCPI in 2019.

Many states ranked similarly in dividends, interest, and rent per capita as they did in net earnings per capita. Connecticut ranked second and Mississippi 50th. Oregon, however, ranked 20th in dividends, interest, and rent per capita ($11,197).

States that ranked high in per capita net earnings generally ranked lower in per capita transfer receipts and states that ranked low in per capita earnings generally ranked higher in per capita transfer receipts. This makes sense. If you are earning income, either through wages or dividends and interest, then you are less likely to need transfer receipts to cover basic living expenses. Oregon, which ranked near the middle in per capita net earnings and 20th in per capita dividends, interest, and rent, moved to 19th highest in per capita transfer receipts ($10,059). Connecticut ranked 17th ($10,154) and Mississippi 14th ($10,310) in per capita transfer receipts.
Oregon’s Population-Driven Relative Trend

Oregon’s PCPI has remained close to the U.S. level since estimates began in 1929. The largest difference between the Beaver State and the U.S. came in 1943 when Oregon climbed to its peak of 123.8 percent of the national level. Oregon’s PCPI was consistently above the U.S. from 1938 to 1956 when incomes were bolstered by defense manufacturing for World War II and the post-war economic boom. In 1943, war-related manufacturing propelled Oregon’s PCPI to its highest level relative to the nation.

In 2009, Oregon’s PCPI dropped below 90.0 percent of the national level for the first time. And the state’s PCPI reached its lowest relative point (88.3%) in 2011. This was largely influenced by two main factors: the Great Recession of 2007 to 2009; and Oregon’s fast population growth. The Great Recession brought job loss and lower earnings, while at the same time Oregon’s population increased as well. Many states with high annual growth in population are also states with low annual growth in PCPI. This relationship can greatly impact a state’s per capita income relative to the national level.
  Oregon’s PCPI relative to the U.S. showed a slow upward trend from 2011 to 2019. In 2011, Oregon’s PCPI was 88.3 percent and by 2019 it had reached 94.2 percent of the U.S.’s PCPI. Population growth works to drive PCPI downward, while income growth works to drive PCPI upward. Oregon’s 2019 population growth rate was 0.9 percent, in the top 12 of the nation. The 2019 total personal income growth rate was eleventh in the nation. Oregon’s PCPI growth rate was 22nd in the nation.

Effects of COVID-19 and CARES Act on Personal Income in 2020

Total personal income estimates are available through 2nd quarter 2020. Over-the-year growth in U.S. total personal income has accelerated from 4.1 percent in the first quarter of 2020 to 34.2 percent in the second quarter, as $2.5 trillion in CARES Act government transfers offset losses in earnings (-27.5%) and property income (-8.6%) due to the COVID-19 pandemic. Oregonians experienced a 45 percent increase in total personal income during this period, receiving $34.8 billion in government transfers in the form unemployment insurance compensation, Medicaid, and all other transfer receipts. As CARES Act funding is available through December 31, 2020, its full effects on personal income are yet to be seen.

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