November 21, 2003

 

Transfer Payments Continue to Rise in North Dakota

Total personal income in North Dakota rose to $16.8 billion in 2002, up 2.6 percent from $16.4 billion in 2001.

This month’s "Economic Brief," a monthly publication by the North Dakota State Data Center at North Dakota State University in Fargo, focuses on personal income figures as reported by the U.S. Bureau of Economic Analysis (http://www.bea.doc.gov/.) Personal income is comprised of earnings (from various industries), property income (dividends, interest, and rent), and transfer payments (income for which no services are performed).

Earnings by place of residence rose 2 percent; property income rose 1.2 percent; and transfer payments such as retirement, disability, medical, and income maintenance payments rose 6.6 percent. This increase in transfers is significant, says Richard Rathge, director of the center. Nearly $1 out of every $6 of North Dakotans’ income derives from government payments. Transfer payments comprised16.8 percent of total income in 2002, up from 15.8 percent in 2001. "The increasing proportion of income generated by transfer payments demonstrates the growing contribution seniors are making to the state’s economic welfare," Rathge says.

North Dakota per capita income grew 3 percent in 2002 to $26,567, up from $25,798 in 2001. Nationally, North Dakota ranks 37th in per capita income, 14 percent below the U.S. average of $30,832. Connecticut ranked 1st at $42,829, followed by New Jersey and Massachusetts ($39,567 and $39,044, respectively).

Government, services, and retail trade are the largest income generating industries in the state, comprising nearly 48 percent of total personal income in 2002. Within North Dakota, the fastest growing non-farm industry between 2001 and 2002 was the military, 14.7 percent.

Farm income, capturing only 1.6 percent of North Dakota’s total personal income in 2002, declined nearly 7 percent between 2001 and 2002. Farm proprietor’s income, capturing less than 1 percent of total income declined by 23.4 percent.

Total personal income figures presented in the November Economic Brief and this accompanying press release are estimates in current dollars, thus not adjusted for inflation. Prices paid by consumers (as measured by the Consumer Price Index, http://www.bls.gov/cpi/ ) increased 1.6 percent between 2001 and 2002. After adjusting for inflation, total personal income increased less than 1 percent.

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Source: Richard Rathge, (701) 231-8621, richard.rathge@ndsu.nodak.edu
Editor: Tom Jirik, (701) 231-9629, tjirik@ndsuext.nodak.edu

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