Personal income in Connecticut grew 3 percent on average in 2016, a rate that was less than the nation as a whole, and it happened at a slower pace than in any other New England state, officials with the federal Bureau of Economic Analysis said Tuesday.
Personal income is defined as the sum of net earnings by place of residence, property income, and personal current transfer receipts.
Four of the top five states in terms of personal income growth in 2016 were in the western United States. Nevada had the nation’s largest percentage increase in personal income, up 7.2 percent over the previous year.
Utah, Washington state, Florida and Oregon rounded out the top five spots of personal income growth. Nevada, Utah, Washington state and Florida had personal income growth in 2016 that increased at a rate twice that of Connecticut.
There was some good news to be found in the data the BEA released: Connecticut continued to have the highest income per capita among the nation’s 50 states. The state’s per capita income of $71,033 is more than $21,000 higher than the nation as a whole and nearly $6,000 above Massachusetts, which was in second place.
The Connecticut industry sectors that saw the biggest income growth, according to the BEA, were:
• Professional, scientific and industrial services.
• Health care and social assistance.
David Cadden, a professor emeritus at Quinnipiac University’s School of Business, said having lagging personal income growth in the state “is a really bad sign for the future of Connecticut.”
“Having strong personal income growth allows small-business people to hire more employees,” Cadden said. “It allows entrepreneurs to be more confident in creating new businesses.”
Rising personal income growth is one of the most important economic statistics for the average working person, he said.
“Personal income is what is in your pocket, which is a pretty important measure,” Cadden said.
Call Luther Turmelle at 203-680-9388.