The Richest And Poorest States
Alaska, Hawaii, and some Grain Belt states bucked a national trend that saw per capita income surging at more than double the inflation rate in many regions.
Nationally, average income for America's 267.6 million men, women, and children totaled $25,598, up 4.8 percent from 1996, the Commerce Department reported Monday. And many people can tell the difference.
"People are busier. More people are working," said Sharon Tonks, a Salt Lake City receptionist. "Less people are complaining. They're happier."
But despite general prosperity, pockets of weakness persisted. Farming was the only major industry in which incomes fell.
"The farmer can't win for losing," said teacher Kris Banks of Hamlin, Texas.
Low prices for wheat, beef and other commodities, and the aftermath of floods last year left some state struggling to catch up.
"We keep thinking we're just around the corner from prices turning and going up," said cattle rancher Tom Olsen of Wessington Springs, South Dakota.
South Dakota per capita income grew 3.4 percent, well below the national average. Its neighbor, North Dakota, posted the only income decline among the 50 states. Per capita income fell 1 percent, dropping the state's rank for income level from 38th in 1996 to 45th in 1997.
Other states with slow per capita income growth were Hawaii, 2.4 percent; Nevada, 2.8 percent; Alaska, 2.9 percent; and Idaho, 3.1 percent. Hawaii's ranking dropped from 12th to 16th.
"Hawaii ... depends heavily on Asian tourism and Asian investment and both of those things have dried up," said Mark Zandi of Regional Financial Associates in West Chester, Pennsylvania. "Alaska is struggling because oil prices are down. Plus they export a lot of processed food to Asia and that's struggling."
Nevada had a strong economy, but its per capita income growth was diluted by rapid population growth. Helped by a construction boom, its total income grew 7.7 percent, second best after Texas. But its population surged 4.7 percent, far surpassing the No. 2 population gainer, Arizona, at 2.7 percent.
Most states, however, saw noticeable gains in purchasing power. Though the increase nationally wasn't all that much better than the 4.6 percent gain in 1996, declining inflation meant it felt a lot better.
The inflation rate for personal consumption expenditures fell from 2.4 percent in 1996 to 2 percent last year. That meant per capita incomes, after inflation, grew 2.8 percent last year compared with 2.2 percent in 1996.
By state, per capita incomes ranged from $36,263 in Connecticut to $18,272 in Mississippi. Growth rates ranged as high as 6.1 percent in Connecticut.
After Connecticut, the states with the fastest growth rates were Texas, 6 percent; Massachusetts, 5.8 percent; Washington, 5.7 percent; Oregon, 5.5 percent; Kansas and Utah, 5.4 percent; New York, 5.2 percent; Colorado, 5.1 percet; and Oklahoma, 5 percent.
The stock market's extraordinary rise last year - the Dow Jones industrial average surged 23 percent - accounts for much of the growth in states such as Connecticut, Massachusetts, and New York.
"Upstate New York is struggling, but the city is doing very well because of all of the bonuses," Zandi said. "In Massachusetts, it's mutual funds. Connecticut is benefiting ... from boutique investment firms moving there. The lifestyle is pleasant and they don't really need to be on Wall Street."
Massachusetts also benefited from the surge in computer-related business. In Texas, it was that, plus increased trade with Mexico, which was recovering from its currency crisis of late 1994. Utah and Colorado also have booming high-tech sectors. Washington and Kansas are doing well because of aerospace orders that poured into Boeing Co., a major employer in both states.
By DAVE SKIDMORE