The U.S. Bureau of Economic Analysis released 3rd quarter state personal income today. Nationally, income growth was slow in the third quarter, increasing just 0.1% over the second quarter. Michigan income growth ranked 14th highest in the third quarter with growth of 0.2% (including Washington D.C. in the rankings).
Michigan’s income growth was stronger in the first quarter, ranking 4th highest, but then fell to 51st highest in the second quarter. This volatility was due in part to the payout of auto bonuses in the first quarter, with wages and salaries in the durable goods manufacturing sector growing 12% in the first quarter and then falling by 3.7% in the second quarter. Durable goods manufacturing wages were virtually unchanged in the third quarter.
Year over year, Michigan personal income was up 3.7% in the third quarter, ranking 31st highest and trailing U.S. growth of 4.1%. Wage and salary earnings, a component of total personal income, were up sharply year over year in the categories management of enterprises (+9.8%), professional, scientific, and technical services (+6.9%), durable goods manufacturing (+6.8%), transportation and warehousing (+6.7%), and administrative and waste management services (+6.5%). Manufacturing as a whole was up 5.4% and healthcare and social assistance was up 4.2%, important contributors to state income growth since these sectors represented 17% and 13% of total wage and salary disbursements respectively.
Sectors showing year-over-year declines included forestry (-3.0%), government (-3.3%), information (-5.4%), mining (-6.6%), utilities (-9.3%), and arts and entertainment (-10.1%). Excepting government, each of these sectors accounted for less than 2% of wage and salary disbursements.
Government accounted for 15.9% of wage and salary disbursements, with state and local government accounting for 85% of the government total. State and local government wage and salary disbursements were down 3.8% compared to a year ago.