Home Bull|Bear Intelligence A Postive Trend in Personal Income

A Postive Trend in Personal Income

by Matt Schreiber

By Matt Schreiber – WBI President and Chief Investment Strategist

State personal income increased at an annual rate of 4.3% in the first quarter of 2018. This is a continuation of the positive trend in personal income. In Q1, every state had growth in personal income. The Bureau of Economic Analysis (BEA) breaks the country into six regions. This quarter, six of eight regions performed better than average. Last year, only two of eight regions performed above the annual average gain in personal income. Although growth in personal income in Q1 2017 was stronger, the growth in each region and underlying states were much more consistent in Q1 of 2018.

U.S. Bureau of Economic Analysis, 2018.

In fact, thirty-one states posted growth equal to in excess of the 4.3% national average increase in personal income. Fifteen states had growth greater than or equal to 5%. Washington led the nation in growth at 7.4%. Information services and durable goods manufacturing were the two largest contributors to the rise in personal income. Across the nation, earnings increased in 23 of 24 industries for which BEA prepares quarterly data. The industries with the largest quarter over quarter increase in earnings were durable manufacturing (12.2%), military (10.3%), mining (10.2%), construction (9.6%), and the federal government (7.2%). 

With a consistent upward trend in personal income, this could take pressure of the consumer and the rising debt burden of the average American household. Consumer credit card debt recently eclipsed $1 trillion and total household debt recently hit a new record. Credit card write-offs for the 8 largest credit card issuers in the United States are up. However, with recent growth in personal and disposable income, the consumer should continue their strong pattern of spending which should be supportive of continued economic growth in the United States.

For more insight, check out the latest episode of Bull | Bear Radio below.

Important Information

Past performance does not guarantee future results.The views presented are those of Matt Schreiber, and should not be construed as investment advice. Matt Schreiber or clients of WBI may own stock discussed in this article. All economic and performance information is historical and not indicative of future results. This is not an offer to buy or sell any security. No security or strategy, including those referred to directly or indirectly in this document, is suitable for all accounts or profitable all of the time and there is always the possibility of loss. Moreover, you should not assume that any discussion or information provided here serves as the receipt of, or as a substitute for, personalized investment advice from WBI or from any other investment professional. To the extent that you have any questions regarding the applicability of any specific issue discussed to your individual situation, please consult with WBI or the professional advisor of your choosing. This information is compiled from sources believed to be reliable, accuracy cannot be guaranteed. Information pertaining to WBI’s advisory operations, services, and fees is set forth in WBI’s disclosure statement in Part 2A of Form ADV, a copy of which is available upon request.

You are not permitted to publish, transmit, or otherwise reproduce this information, in whole or in part, in any format to any third party without the express written consent of WBI Investments, Inc. 

You may also like