In a year when one might expect Americans’ personal income to decrease, 2020 saw the greatest increase in personal income growth in 20 years, according to figures published in a recent blog post from the Utah Foundation.
The COVID-19 pandemic and its related economic shutdown inspired a far-reaching increase in governmental assistance. Policymakers focused on increasing funds for unemployment benefits and government transfers, more widely known as stimulus checks, in hopes of offsetting the impacts from a growing unemployment rate. This resulted in a nationwide personal income increase of 4.9 percent.
Four Mountain States ended the year atop the nation in personal income growth. Arizona and Montana experienced an increase of 7.1 percent in personal income and Utah ranked third in the country with a 6.9 percent increase, followed by Idaho with a 6.8 percent annual increase. One Mountain state — Wyoming — was at the very bottom of the nation, but still saw an increase of 1.1 percent.
Most of the personal income growth came from government transfers. However, Utah ranked No. 1 in the nation when personal income growth was calculated without government assistance, gaining 2.3 percent.
Average personal income in 2020 per working-age adult (18-64) was $88,885 in Utah and $97,813 nationally. Utah Foundation authors pointed out that these averages rise far above the typical or median working-age adult because of high-income earners.
Utah has led the U.S. on the income front through past times of economic hardship. After the Great Recession, recovery varied from state to state. However, from the start of the Great Recession in 2007 to the end of fourth quarter 2019, Utah had the largest long-term compound annual growth rate at 3.4 percent.