Per capita income in Ohio dips 1.4%, $508 per resident
3/26/2010Per capita personal income in Ohio shrank 1.4 percent last year and fell 2.7 percent in Michigan as the recession wreaked havoc on the economies of the Great Lakes states, according to new estimates by the U.S. Bureau of Economic Analysis.
The bureau estimated that personal income in Michigan - including wages, investment income, and rental income - declined $30.3 billion last year from 2008, while personal income in Ohio declined by $19.8 billion. That translated to a loss of $928 per resident in Michigan, and a loss of $508 per resident of Ohio.
Nationally, per capita personal income declined 2.6 percent in 2009, while aggregate personal income declined 1.7 percent, the bureau estimated.
Dana Johnson, a Dallas-based economist who studies Michigan for Comerica Bank, said the personal income figures conform with Ohio's economic picture.
"There has been a very considerable slowing in the rate of change in average hourly earnings," he said. "There's very little pricing power, so average hourly earnings are still rising, but very slowly. It's a very weak picture for labor income, no question about it."
Michigan ranked 34th among states in terms of percentage loss of income, and Ohio 16th. West Virginia, Maryland, and Maine were among only six states to record an increase in personal in-come in the United States during 2009, while South Dakota, Wyoming, and Nevada recorded the largest loss of personal income last year.
The Great Lakes region - Michigan, Ohio, Indiana, Illinois, and Wisconsin - fared the third worst of any region in the nation in maintaining personal income.
Both Michigan and Ohio recorded personal income losses or stagnation in every private sector of their respective economies except utilities, educational services, and health care and social services. Losses in durable-goods manufacturing represented the largest share of the overall loss of personal income, the analysis found.
Personal incomes from public sources - local, state, and federal government and the military - increased.
David Lenze, an economist with the Bureau of Economic Analysis, said unemployment benefits paid to Ohioans during 2009 "would have added 1.25 percentage points to personal income growth in Ohio," but were offset by declines in wages, salaries, and other forms of income.
"That's a quite substantial impact," Mr. Lenze said.
Economist Jim Coons, of J.W. Coons Advisors LLC in suburban Columbus, found positive signs for Ohio's economy buried deep in the bureau's report, which showed that Ohio's fourth-quarter personal income figures rose from the third quarter, the first increase in 1 1/2 years.
"We have a long way to climb back, though," Mr. Coons said.
Contact Larry P. Vellequette at:
lvellequette@theblade.com
or 419-724-6091.