This morning, the Bureau of Labor Statistics issued its report on State Personal Income for the fourth quarter of 2014 and for calendar-year 2014. The headline statistic was an national average growth rate of 3.9% from 2013 to 2014. In Arkansas, the annual growth rate was 3.1%. Per capita income in Arkansas rose by 2.9% to $37,751, while national per capita income rose 3.0% to $46,129. Accordingly, Arkansas per capita income remained at 82% of the national average, with a ranking of 44th among the 50 states plus D.C.
Total earnings — which includes wages and salaries, employer supplements to wages and salaries, and proprietors income — rose by 1.9% in 2014, compared to a 4.1% increase nationally. The table below shows the growth rates of total earnings broken down by industry. Growth rates in Arkansas were below the national average in most sectors.
For the fourth quarter of 2014, Arkansas personal income increased 1.2% from the previous quarter, and was up 4.5% from the fourth quarter of 2013. For the U.S., the comparable growth rates were 1.0% quarterly and 4.5% year-over-year. Since the recession of 2008-09, Personal income in Arkansas has been tracking fairly close to the national average. Compared to the previous cyclical peak (2008:Q2), total income in Arkansas is up 20.6% (an average annual rate of 2.9%). Since the trough of the recession (2010:Q1), Arkansas income has increased by 24.7% (a 3.5% annual rate).
The table below shows some of the key components of personal income growth in the fourth quarter. Two components are notable. First, growth of Proprietors’ incomes in Arkansas significantly exceeded the national average in both the quarterly and year-over-year data. Second, another area of strong income growth in Arkansas — particularly in the year-over-year figures — was personal current transfer receipts. This component was boosted by payments associated with Medicaid expansion (a.k.a. the “Private Option”). Today’s report from the BEA noted that “Medicaid transfer receipts increased 13.6 percent in the states where coverage expanded in 2014 under the Affordable Care Act and 7.3 percent in the states where coverage did not expand.” In Arkansas Medicaid transfers increased by 29.2% from 2013:Q4 to 2014:Q4. That was ore than twice the national average rate of 13.3%.