OLMIS

by Amy Vander Vliet
Published Feb-7-2013

Per Capita Personal Income Further Reading

The U.S. Department of Commerce's Bureau of Economic Analysis (BEA) recently released 2011 personal income data for metro areas and counties. Personal income is derived from three sources: earnings; dividends, interest, and rent; and transfer payments (e.g. Social Security payments, unemployment insurance, Medicare).

The Portland metro area's total personal income was $93.4 billion in 2011; the 24th largest metro area in the country by this measure, or about the size of Utah. After adjusting for inflation, income rose by 3.0 percent between 2010 and 2011 ($2.7 billion). This was the second consecutive year of growth, but not quite enough to make up for the dramatic 5.1 percent loss during the recession. Inflation-adjusted income is 0.6 percent ($5.5 million) below the pre-recession peak reached in 2008.

The vast majority of personal income comes from the earnings component. The Portland metro area derived over two-thirds (67.0%) of its income from earnings in 2011, about the same as the U.S. (65.9%) and more than Oregon (61.8%). Transfer payments made up 16.0 percent, primarily in the form of Social Security and Medicare/Medicaid. Dividends, interest, and rent accounted for the remainder.

Per capita personal income (PCPI) is personal income divided by total population. In 2011, Portland metro's PCPI was $41,302. In comparison, the nation's PCPI was $41,560 and Oregon's was $37,527. Across the nation's metro areas, PCPI ranged from a low of $21,620 (McAllen-Edinburg-Mission, TX) to a high of $78,504 (Bridgeport, CT). Portland ranked 83rd highest out of 367 metro areas.

Portland PCPI rose 1.7 percent in 2011 following a gain of 0.5 percent in 2010 (inflation-adjusted). Portland's PCPI dipped below the nation's in 2009 after years of surpassing it, although the gap started narrowing in 2001. Both recessions in the 2000s hit Portland harder than the nation in terms of job losses, which partially explains the narrowing gap. But there are many possible factors that can also help explain movements and differences in PCPI, some due to economic structure, demographic trends, and people's choices, to name a few.

It's important to keep in mind that PCPI is not a measure of earnings. The average wage per job in the metro area actually increased 5.5 percent between 2001 and 2011, yet PCPI declined 1.9 percent. Nationally, average wages increased more slowly (3.1%), while PCPI growth (5.0%) outpaced Portland's.

The Workforce and Economic Research division of the Oregon Employment Department has analyzed personal income data extensively over the past few years.

• For an in-depth examination of PCPI in Oregon and the nation, see the report Why Oregon Trails the Nation at  www.qualityinfo.org/pubs/pcpi/pcpi.pdf. The article is several years old and will be updated, but the underlying analysis is still relevant.
  
  
• For a comparison of Oregon and Washington PCPI, see the article Per Capita Personal Income: Oregon and Washington Comparisons at  www.qualityinfo.org/olmisj/ArticleReader?itemid=00008440.
  
  
• For urban/rural perspective, see Rural and Urban Personal Income at www.qualityinfo.org/olmisj/ArticleReader?itemid=00007832.

Personal income data is produced by the Bureau of Economic Analysis: www.bea.gov