screen-shot-2018-10-19-at-10-04-05-am-150x150-9251522Newly released federal data on personal income growth last year point to the continued economic weakness of upstate New York.

Measured in current dollars, unadjusted for inflation, personal income nationally increased 5.6 percent from 2017 to 2018, according to the Bureau of Economic Analysis (BEA).

In New York, however, statewide personal income growth was just 4.3 percent—fifth lowest of any state. This probably reflected, at least in part, the impact of the new federal tax law, effective in 2018. The impending loss of uncapped SALT deductions is thought to have prompted many high earners to accelerate salary and bonus income from 2018 into 2017—when New York’s annual personal income growth of 6.8 percent was well above the 50-state average of 4.7 percent.

Another tale of two states

Personal income in the 50 upstate counties (which, with fewer high-income earners than the New York City region, would have been less affected by the SALT cap) grew just 3.05 percent in 2018. That average ranked in the bottom quintile for counties nationally and was far below the level of the slowest growing state (Kentucky, at 3.9 percent).

County-by-county numbers and the upstate-downstate averages of personal income for 2017 and 2018 are shown in the following table.

screen-shot-2019-11-14-at-3-22-35-pm-1024x913-7480244

The BEA’s 50-state map of county-level personal income growth rates across the country provides a broader comparative illustration of the trend. Most New York counties are in lighter shades, denoting lower rates of growth.

screen-shot-2019-11-14-at-10-13-27-am-1024x638-6861859

Bottom dwellers

On a county-by-county basis, 43 of the 50 upstate counties ranked in the bottom quintile nationally, and 20 were in the bottom 10 percent of all counties nationwide. The slowest-growing 10 upstate counties had personal income growth below the inflation rate of 1.9 percent.

By contrast, the 12 counties of the downstate region—including New York City and seven suburban counties comprising the Metropolitan Commuter Transportation District—had a combined growth rate of 4.7 percent. This was above While this was below the national average it ranked within the middle quintile of the national distribution for all counties.

Only two upstate counties ranked among the top 10 statewide in terms of personal income growth: Sullivan County in the Catskills (where the Resort World casino opened in 2018) and Saratoga County in the Capital Region.

Why it matters

Personal income measures how much the residents of a given area have earned from wages and salaries, and from business proprietor receipts, royalties, rents, and transfer payments such as social security benefits and pensions. Because it does not include capital gains, it does not fully reflect the wealth of any given locality. However, it is an important reflection of economic health, and especially of purchasing power.

About the Author

E.J. McMahon

Edmund J. McMahon is a senior fellow at the Empire Center.

Read more by E.J. McMahon

You may also like

As a Supreme Court Ruling Loomed, Cuomo Bent His Own Rules on COVID ‘Clusters’

In the midst of the constitutional showdown over his pandemic policies, Governor Cuomo made changes to a disputed Brooklyn 'cluster zone' that seemed to contradict his own declared guidelines. Read More

With Employment Lagging, Cuomo Can—And Should—Postpone Scheduled Minimum Wage Hike

Still struggling to recover from spring pandemic shutdowns, now facing due to a second wave of COVID infections, the last thing New York's economy needs is a state-mandated disincentive to put people back to work. Nonetheless, at the worst possible ti Read More

New York’s Jobs Recovery Chugged to a Near-Halt in October

After rising sharply once the economy began to reopen, private payroll growth in New York ominously ran out of steam in October, according to the state's monthly jobs report. Read More

New York’s Rising COVID Curve Casts Doubt on Cuomo’s ‘Micro-Cluster’ Strategy

The ongoing surge in New York's coronavirus pandemic raises doubts about the effectiveness of Governor Cuomo's "micro-cluster" strategy. Read More

Thanks to Unions, NYC’s School Reopening Deal Was Costly and Educationally Hazardous

New York City schools reopened this fall under terms dictated by the city's teacher and principal unions. Now, as city schools close -- once more at the unions' behest -- the city is left with thousands of extra teachers hi Read More

New Yorkers’ Personal Income Growth Rebounded a Bit in 2019

After , personal income growth matched or exceeded national averages in most parts of New York State in 2019, according to the from the federal Commerce Department's Bureau of Economic Analysis (BEA). The 2019 income rebound was most pronounced in New Read More

With State Officials’ Freeze Through 2023, More Reason To Ice All Government Pay

In light of the state government’s “extremely precarious financial position,” New York’s state lawmakers, judges, statewide elected officials and certain gubernatorial appointees should not receive pay raises in the Read More

The Autumn Coronavirus Wave Is Hitting New York’s Nursing Homes, Too

Coronavirus infections are again rising in New York's nursing homes, a sign that blanket testing, tight limits on visitors and other precautions have not fully isolated their acutely vulnerable residents from conditions in Read More

Subscribe

Sign up to receive updates about Empire Center research, news and events in your email.

CONTACT INFORMATION

Empire Center for Public Policy
30 South Pearl St.
Suite 1210
Albany, NY 12207

Phone: 518-434-3100
Fax: 518-434-3130
E-Mail: info@empirecenter.org

About

The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.