Real personal income across all regions rose by an average of 2.9 percent in 2014. This growth rate reflects the year-over-year change in nominal personal income across all regions adjusted by the change in the national personal consumption expenditures (PCE) price index. On a nominal basis, personal income across all regions grew an average of 4.4 percent in 2014. In 2014, the U.S. PCE price index grew 1.4 percent.
Real Personal Income for States and Metropolitan Areas. Growth in real state personal income in 2014 ranged from 4.7 percent in Nevada to 0.4 percent in South Dakota (table 1). These growth rates reflect the year-over-year change in the state’s nominal personal income, the change in the national PCE price index, and the change in the state’s regional price parity. After Nevada, the states with the highest growth rates were Colorado (4.5 percent), Texas (4.2 percent), Washington (4.0 percent), and Oregon (4.0 percent). After South Dakota, the states with the slowest rates of growth were Kansas (0.5 percent), West Virginia (0.7 percent), Illinois (1.0 percent), and Vermont (1.3 percent). States with growth rates close to the national average were Alaska (3.1 percent), Oklahoma (3.1 percent), Michigan (2.9 percent), New Jersey (2.9 percent), Massachusetts (2.8 percent), Connecticut (2.8 percent), and Tennessee (2.8 percent).
Growth in real metropolitan area personal income in 2014 ranged from an increase of 8.1 percent in Odessa, TX to a decline of 3.9 percent in Danville, IL. After Odessa, TX, the metropolitan areas with the largest growth rates were Hanford-Corcoran, CA (7.0 percent), Midland, TX (7.0 percent), Myrtle Beach-Conway-North Myrtle Beach, SC-NC (6.0 percent), Salem, OR (5.8 percent), and Beaumont-Port Arthur, TX (5.6 percent). After Danville, IL, the metropolitan areas with the largest declines were Beckley, WV (-3.3 percent), Bloomington, IL (-3.2 percent), Grand Forks, ND-MN (-1.4 percent), Peoria, IL (-1.1 percent), and Yuma, AZ (-1.1 percent).
Regional Price Parities. Regional Price Parities (RPPs) measure the differences in the price levels of goods and services across states and metropolitan areas for a given year. RPPs are expressed as a percentage of the overall national price level for each year.
In 2014, the District of Columbia’s RPP (118.1) was higher than that of any state (table 3). The states with the highest RPPs were Hawaii (116.8), New York (115.7), New Jersey (114.5), and California (112.4). Mississippi (86.7), Arkansas (87.5), Alabama (87.8), South Dakota (88.0), and Kentucky (88.7) had the lowest RPPs among the states. States with high (low) RPPs typically have high (low) price levels for rents. States with RPPs closest to the national average price level were Vermont (101.2), Illinois (100.7), Florida (99.1), Oregon (99.0), and Rhode Island (98.7).
In 2014, the metropolitan area with the highest RPP was Urban Honolulu, HI (123.5). Metropolitan areas with RPPs above 120.0 also included San Jose-Sunnyvale-Santa Clara, CA (122.9), New York-Newark-Jersey City, NY-NJ-PA (122.3), Santa Cruz-Watsonville, CA (121.8), San Francisco-Oakland-Hayward, CA (121.3), and Bridgeport-Stamford-Norwalk, CT (120.4). The metropolitan area with the lowest RPP was Beckley, WV (79.7), followed by Rome, GA (80.7), Danville, IL (81.1), Morristown, TN (81.9), and Jonesboro, AR (82.0).