From 2016 to 2017, personal income in South Dakota grew by just 1.4%, according to a recent release by the Bureau of Economic Analysis. Only five other states had slower rates of personal income growth, Nebraska, Kansas, Iowa, Alaska and North Dakota.
A decline in farm earnings contributed to slow personal income growth in South Dakota as well as the region. Across the nation, farm incomes decreased by a total of 6.6%, with the largest declines occurring in South Dakota and North Dakota. In South Dakota farm incomes fell by 1.1%. But North Dakota was hit the hardest with farm incomes contracting by 1.9%. This contributed to an overall decline in personal income of 0.3% in North Dakota from 2016 to 2017.
Other states in the region were also impacted by falling farm incomes. In Nebraska, incomes from farm earnings fell by 0.9%, contributing to overall personal income growth of just 1.4% from 2016-2017. Similarly, Iowa’s personal income increased by just 0.3% in the wake of a 0.8% decline in farm incomes. The table below shows the impact of farm earnings on overall personal income growth for states in the region:
|State||% Change in Farm Earnings||% Change in Total Earnings 2016-2017|
The primary growth driver in the third quarter was the Finance and Insurance industry, which grew by 1.7%. Nationally, the Finance industry increased by 14.7% and was the top contributor to growth in seven of the ten fastest growing states. Several other industries also contributed to third quarter growth: Durable Goods Manufacturing (0.5%), Retail Trade (0.4%), and Health Care and Social Assistance (0.4%). The chart below displays contribution of earnings by industry to personal income growth from 2016 to 2017.