Rise in Personal Income Not the Good News You Might Think

Personal income rose in Mississippi by 0.2% in the first quarter of 2009.

Mississippi saw a rise in personal income in the first quarter of 2009, while most of the country saw a decline. But as MPB’s Cari Gervin discovered, that increase doesn’t show the whole picture.

So if personal income in the state rose by two-tenths of a percent, while income declined nationally at half a percent, that has to be good news for Mississippi? Right?

“Mississippi is losing jobs, it’s hurting, uh, wages and salaries, just like in the rest of the country.”

That’s David Lenze. He’s an economist with the Federal Bureau of Economic Analysis, which comes up with the personal income statistics.

He says that the state’s net earnings in wages and salaries declined, as did income from interest and dividends. What accounts for the increase in income, he says, are transfer receipts.

“And that includes benefits of retirees and also unemployment compensation for people who have been laid off. And in this quarter, primarily because of the cost-of-living adjustments that retirees received to their social security checks, that was enough to offset the declines in other types of income in Mississippi.”

So the income gains aren’t really good news, says state senior economist Marianne Hill.

“No, I can’t say that I see a turnaround here.”

But they’re not bad news either. And Hill says there are other economic indicators that do seem to signify a turnaround in housing and even manufacturing.

“I would say that in Mississippi the odds are that we will be hitting – seeing – the bottom of the recession before the end of the year.”

Unfortunately, Hill says she doubts hiring will perk up until the middle of 2010.

For MPB News, I’m Cari Gervin.