Decrease in Farm Earnings Slows Personal Income Growth in South Dakota in 2017 Bureau of Economic Analysis
Mar 23, 2018

Decrease in Farm Earnings Slows Personal Income Growth in South Dakota in 2017

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
 Iowa -0.8 0.3
Minnesota 0.1 2.4
Montana 1.8 -0.3
Nebraska -0.9 1.4
North Dakota -1.9 -0.3
South Dakota -1.1 1.4
Wyoming -0.2 0.6

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.

personal income growth

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