Oregon’s Per Capita Personal Income 2021October 30, 2022
Oregon’s total personal income ranked 25th in the nation in 2021, moving down three places from its 2020 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 7.2% in 2021, slightly higher than the previous year’s growth rate of 6.6%. For individual states in 2021, growth ranged from a 4.9% increase in Alaska and Vermont, to a 9.8% increase in Florida. Personal income grew by 8.2% in Oregon in 2021, which was the 10th fastest in the nation (tied with Washington). According the Bureau of Economic Analysis, changes in personal income since February 2020 primarily reflected changes in governmental social benefits, stemming from the enactment and expiration of legislative acts and related programs during the pandemic.
Per Capita Personal Income
The size of a state’s population plays a predominant role in the size of its personal income. California, Texas, New York, Florida, Illinois, and Pennsylvania – 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, Wyoming, and Vermont – 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 a little over $261 billion in 2021, while Texas had personal income of more than $1.7 trillion. Per capita personal income, however, was $61,596 for Oregon and $59,865 for Texas.
Adjusting to PCPI adjusts the income rankings of states as well. Massachusetts ranked 11th in total personal income but ranked first in the nation in PCPI. West Virginia ranked 41st in total personal income, but ranked 49th of the states in PCPI. Oregon ranked 25th in total personal income, but ranked 21st in per capita personal income.
Comparison of PCPI Components
For the United States as a whole, 59.9% of PCPI came from net earnings in 2021. Massachusetts took the top slot ($52,872) and West Virginia took the bottom ($24,871) in dollar value of per capita net earnings. For Massachusetts, 63.2% of PCPI came from net earnings and for West Virginia it was 51.3%. Oregon ranked 24th among the states in per capita net earnings ($35,634), which accounted for 57.9% of the state’s PCPI in 2021.
Many states ranked similarly in dividends, interest, and rent per capita as they did in net earnings per capita. Massachusetts ranked fourth and West Virginia 49th. Oregon ranked 23rd in dividends, interest, and rent per capita ($11,024). Typically, Oregon ranks higher in per capita dividends, interest, and rent (ranked 20th in 2019 with $11,196).
States that rank high in per capita net earnings typically rank lower in per capita transfer receipts, and states that ranked low in per capita earnings typically rank higher in per capita transfer receipts. This makes sense. If you are earning income, either through wages, dividends, interest, or rent, then you are less likely to need transfer receipts to cover basic living expenses. However, during the pandemic recession, direct economic impact payments were paid to the majority of U.S. households in 2020 regardless of employment status. Oregon, which ranked near the middle in per capita net earnings (24th) and in per capita dividends, interest, and rent (23rd), moved to 12th highest in per capita transfer receipts ($14,938). Massachusetts ranked seventh ($15,430) and West Virginia ranked second ($16,428) 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% 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% of the national level for the first time. And the state’s PCPI reached its lowest relative point (88.0%) 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. 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 2020. In 2011, Oregon’s PCPI was 88.0% and by 2020 it had reached 95.4% of the U.S.’s PCPI. Boosted by Federal relief payments, Oregon’s PCPI relative to the nation’s increased by 0.6 percentage point from 2020 to 2021. Population growth works to drive PCPI downward, while income growth works to drive PCPI upward. Oregon’s 2021 population growth rate was 0.1%, ranking near the middle across the U.S. The 2021 total personal income growth rate was 10th in the nation. Oregon’s PCPI growth rate was eighth in the nation.