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16 states where incomes are booming

24/7 Wall St. logo 24/7 Wall St. 6/5/2018 Michael B. Sauter and Grant Suneson

a view of a city © AndreyKrav / iStock During the Great Recession, U.S. gross domestic product declined 4.3%. Since then, the economy has rebounded and is now in one of the longest periods of expansion on record.

As the economy recovered, the U.S. labor market also began to improve. The unemployment rate dropped from 8.1% in 2012 to 4.4% in 2017, and total employment increased by over five million people. Personal income also grew by 11.2% across the nation in that time frame, while per capita personal income increased by 7.2%.

The economic expansion has not benefited all states equally. In some states, personal incomes grew by less than 5%, and one, North Dakota, actually reported an income decline of 1.8% between 2012 and 2017. On the other hand, total personal income in some states has grown by more than 15% and even over 20% in one over the last five years

Compared to five years ago, there are fewer Americans working in manufacturing and construction, which each tend to be low-paying industries. More Americans took jobs in the financial sector and the professional and business services industry, which tend to pay higher salaries. In an interview with 24/7 Wall St., Martin Kohli, chief regional economist with the Bureau of Labor Statistics, said the generally high-paying information sector -- which includes software development and data processing -- has also led income growth nationwide in recent years, despite an overall decline in employment in the industry.

“... some of the big internet technology companies that have large concentrations in California and some of the western states -- they're not necessarily adding lots and lots of people, but they are seeing big increases in income,” Kohli said.

To determine the states where personal incomes are booming, 24/7 Wall St. reviewed total personal income change from the the U.S. Bureau of Economic Analysis. Personal incomes in the 16 states listed here grew by more than the nation’s 11.2% growth rate from 2012 to 2017.

a view of a city street filled with traffic surrounded by tall buildings © Thinkstock 16. North Carolina

> Personal income growth (2012-2017): +12.5%
> Per-capita personal income: $42,421 (18th lowest)
> Employment growth (2012-2017): +10.8% (14th largest increase)
> GDP growth (2012-2017): +10.5% (15th largest increase)

North Carolina's population grew at a 5.0% pace between 2012 and 2017 as the state attracted nearly 475,000 new residents. With North Carolina's personal income increasing by 12.5% since 2012, financial prosperity may have been a driving factor in migration.

a view of a city © Thinkstock 15. Hawaii

> Personal income growth (2012-2017): +12.5%
> Per-capita personal income: $39,062 (7th lowest)
> Employment growth (2012-2017): +7.7% (19th largest increase)
> GDP growth (2012-2017): +9.5% (23rd largest increase)

Though Hawaii is often considered a vacation destination, it is also has one of the best job markets in the country. Hawaii's annual unemployment rate of just 2.4% is the lowest in the nation. As more people in the labor force find work, personal income increases.

a view of a city next to a body of water © Thinkstock 14. Michigan

> Personal income growth (2012-2017): +12.6%
> Per-capita personal income: $43,192 (21st lowest)
> Employment growth (2012-2017): +8.4% (17th largest increase)
> GDP growth (2012-2017): +10.1% (17th largest increase)

Michigan's economy has undergone a significant turnaround in recent years. The state's unemployment improved significantly, dropping from 10.4% in 2011 to 4.6% in 2017. This may be partly behind the state's 12.6% increase in personal income since 2012.

a lit up city at night © Thinkstock 13. Delaware

> Personal income growth (2012-2017): +12.7%
> Per-capita personal income: $43,658 (25th lowest)
> Employment growth (2012-2017): +8.6% (16th largest increase)
> GDP growth (2012-2017): +7.9% (23rd smallest increase)

No state has a higher share of workers in the financial sector than Delaware. Some 10.5% of the state's labor force works in the finance sector, a generally high-paying industry. Employment in Delaware's finance industry grew by 5.7% over the last decade, one of the higher growth rates for the industry nationwide.

a view of a city at night © f11photo / Thinkstock 12. Tennessee

> Personal income growth (2012-2017): +12.8%
> Per-capita personal income: $43,701 (25th highest)
> Employment growth (2012-2017): +10.9% (13th largest increase)
> GDP growth (2012-2017): +12.3% (11th largest increase)

Tennessee added over 80,000 professional and business service jobs over the last 10 years, a 25.8% increase. The professional and business service sector is one of the higher-paying industries, and the industry's employment increase likely contributed to the Volunteer State's 12.8% increase in personal income since 2012.

a view of a city street © Thinkstock 11. South Carolina

> Personal income growth (2012-2017): +15.8%
> Per-capita personal income: $39,860 (8th lowest)
> Employment growth (2012-2017): +12.2% (11th largest increase)
> GDP growth (2012-2017): +13.3% (9th largest increase)

Personal income in South Carolina has grown by 15.8% since 2012, likely because more people in the state have become employed. The unemployment rate declined from 9.2% in 2011 to 4.3% in 2017, one of the steepest drops in the nation. Employment in the state increased by 12.2% over that period, one of the larger increases of any state.

a small house in a body of water © Thinkstock 10. Florida

> Personal income growth (2012-2017): +16.2%
> Per-capita personal income: $41,852 (17th lowest)
> Employment growth (2012-2017): +15.8% (3rd largest increase)
> GDP growth (2012-2017): +14.6% (7th largest increase)

As Florida's population has grown more than any state in the country, personal incomes are also growing faster than most other states. A net of over 1.9 million people have migrated to the Sunshine State since 2010, a 10.3% growth rate. Both figures are higher than any other state.

a view of a city at night © Thinkstock 9. Georgia

> Personal income growth (2012-2017): +16.6%
> Per-capita personal income: $41,836 (16th lowest)
> Employment growth (2012-2017): +12.6% (9th largest increase)
> GDP growth (2012-2017): +14.5% (8th largest increase)

Georgia's personal income grew by 16.6% between 2012 and 2017, largely bolstered by the state's trade, transportation, and utilities industry. The sector accounts for 21.1% of all Georgia jobs and employment in the industry has grown 5.3% over the last 10 years.

a view of a large body of water with a city in the background © Thinkstock 8. California

> Personal income growth (2012-2017): +16.6%
> Per-capita personal income: $45,358 (23rd highest)
> Employment growth (2012-2017): +13.9% (8th largest increase)
> GDP growth (2012-2017): +18.5% (2nd largest increase)

As home to Silicon Valley, California is the hub of America's high-paying tech jobs. Employment in California's information industry grew 12.0% over the past decade, a time when the American information industry lost 7.8% of its jobs. Though it accounts for just 3.1% of California's employment, the high-paying information sector has likely contributed to rising personal income in California.

a view of a city next to a body of water © Thinkstock 7. Oregon

> Personal income growth (2012-2017): +17.5%
> Per-capita personal income: $41,366 (13th lowest)
> Employment growth (2012-2017): +14.2% (6th largest increase)
> GDP growth (2012-2017): +10.4% (16th largest increase)

Personal income rose significantly in Oregon between 2012 and 2017, and it appears that the improvement resulted in a number of state residents exiting poverty. The poverty rate in Oregon dropped from 17.2% in 2012 to 13.3% in 2016 -- the largest percentage point drop of any state during that time.

a large body of water with a city in the background © miroslav_1 / iStock 6. Arizona

> Personal income growth (2012-2017): +18.1%
> Per-capita personal income: $38,658 (5th lowest)
> Employment growth (2012-2017): +12.5% (10th largest increase)
> GDP growth (2012-2017): +10.0% (18th largest increase)

Arizona representatives have convinced several companies to relocate from California, bolstering the state's tech and financial sectors. Over the last 10 years, the number of workers in Arizona's information industry grew 8.7% and its financial industry spiked 14.6% during the same time -- both among the highest growth rates of any state. These high income jobs likely helped spur personal income growth in the state.

a large body of water with a city in the background © Thinkstock 5. Washington

> Personal income growth (2012-2017): +18.2%
> Per-capita personal income: $47,505 (12th highest)
> Employment growth (2012-2017): +13.9% (7th largest increase)
> GDP growth (2012-2017): +19.3% (the largest increase)

Major tech companies like Amazon are likely the key catalysts behind Washington's high personal income growth. Some 3.8% of workers in Washington are employed in the information industry, a higher share than in any other state. The state's tech industry has undergone massive growth over the last decade, with the number of jobs ballooning 23.5% over the last 10 years.

a tall building in a city © Thinkstock 4. Nevada

> Personal income growth (2012-2017): +18.5%
> Per-capita personal income: $40,799 (11th lowest)
> Employment growth (2012-2017): +17.1% (2nd largest increase)
> GDP growth (2012-2017): +12.5% (10th largest increase)

Though Nevada is famous for Las Vegas, the state's leisure and hospitality industry grew less than that of every other state since 2007. Nevada's personal income growth was likely helped most by the education and health services sector, which grew its workforce 43.6% since 2007 and now employs 9.9% the state's labor force.

a large body of water with a city in the background © Thinkstock 3. Colorado

> Personal income growth (2012-2017): +18.7%
> Per-capita personal income: $46,256 (18th highest)
> Employment growth (2012-2017): +15.0% (5th largest increase)
> GDP growth (2012-2017): +17.6% (4th largest increase)

Colorado's unemployment rate dropped by more than 5 percentage points since 2012 through 2017, one of the largest drops in the country. The leisure and hospitality sector added 63,000 jobs in the past decade, which likely contributed to the state's rise in personal income. It also helped offset the employment decline in Colorado's information industry, which shrank by 4,700 jobs, or 6.2%, over the same time.

a view of a city with a mountain in the background © Thinkstock 2. Idaho

> Personal income growth (2012-2017): +19.0%
> Per-capita personal income: $38,785 (6th lowest)
> Employment growth (2012-2017): +15.4% (4th largest increase)
> GDP growth (2012-2017): +15.0% (6th largest increase)

Over the past five years, Idaho's employment increased 15.4%, likely contributing to the Gem State's 19.0% personal income growth. The number of manufacturing jobs nationwide declined by more than 10% over the past 10 years. In Idaho, however, the manufacturing industry increased slightly, and it currently makes up 9.3% of the state's workforce. Since 2011, Idaho's labor force has grown 8.9%, roughly double the U.S. labor force growth rate of 4.4%.

a view of a city at night © Thinkstock 1. Utah

> Personal income growth (2012-2017): +20.9%
> Per-capita personal income: $38,477 (3rd lowest)
> Employment growth (2012-2017): +17.4% (the largest increase)
> GDP growth (2012-2017): +17.8% (3rd largest increase)

Utah's personal income has grown by 20.9% since 2012, the highest rate of growth of all 50 states. This boost has come as the state workforce has also grown faster than any other state. Between 2012 and 2017, state employment grew from or seeking work grew from 1.25 million to 1.47 million. That 17.4% increase was the largest of any state. Utah's growing tech industry, which tends to have growing and high wages, likely helped contribute to the state's nation-leading income growth.

Detailed Findings & Methodology:

While personal income has increased in nearly all states, it has grown most in Western states. All eight of the states with the highest personal income percentage growth are neighbors. States like Arizona, California, and Utah, added thousands of workers in information, finance, and other high-paying industries.

North Dakota is the only state in which personal income declined from 2012 to 2017. This is a departure, considering that from 2008 to 2017, no state had a larger increase in its personal income than North Dakota, at 30.9%. The state had a huge oil boom in 2007, attracting corporations who hired workers by the thousands. But once oil prices started so slide, the jobs dried up and much of North Dakota’s economic growth abated.

The United States is adding jobs in more specialized and high-income industries. There are 14.1% more people working in the professional and business services industry now than there were in 2007. The sector with the largest employment growth over that period is education and health services, which includes teachers, doctors, and other health care professionals. There are 24.1% more workers in the industry than there were in 2007.

24/7 Wall St. reviewed Bureau of Economic Analysis data on personal income -- the sum of net earnings by all people from all sources -- in each state for each year from 2012 to 2017. We ranked states by real personal income growth from 2012 to 2017 -- measured in 2009 dollars.
The BEA has not yet published real personal income figures for 2017. We derived our own estimates of real personal income for 2017 by adjusting nominal figures from regional and national prices, based on the BEA’s methodology. Also from the BEA, we considered industry contributions to GDP for 2012 and 2016. Labor force, industry employment, and unemployment rates figures are from the Bureau of Labor Statistics. Socioeconomic factors, such as educational attainment rates, poverty rates, and net population change from migration, came from the U.S. Census Bureau’s 2016 American Community Survey (ACS).

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