The consumer price index jumped by 0.8% in April -- a far larger increase than many had anticipated. The recent spike in the cost of goods and services has led to widespread concerns over inflation. If the cost of living continues to climb at such a rapid pace, it could outpace wage growth, weakening the buying power of the American consumer. Such an outcome would be a reversal of a long-term trend in much of the United States.
Over the last 10 years, real personal income per capita, a measure of annual earnings that is adjusted for inflation, climbed in the United States from $42,287 in 2010 to $53,071 in 2020. There are many potential factors that drove up real personal income, not the least of which is wage growth outpacing inflation.
Income per capita, adjusted for inflation, stands at $57,412 in Illinois -- 32% higher than in 2010, when real personal income per capita in the state was just $43,506. Over the same period, average weekly wages in the state, not adjusted for inflation, climbed 30.1% -- from $796 to $1,036.
The surge in personal income in Illinois was likely driven primarily by greater workforce participation. Since 2010, the state's population contracted by 5.7%, while overall employment climbed by 1.4% over the same period. Professional and business services and construction were the two fastest growing industries by employment in Illinois between 2010 and 2020.
Percent growth in real personal income per capita from 2010 to 2020 was calculated using data from the Bureau of Economic Analysis. Personal income figures were adjusted from current dollars to constant 2012 dollars using the U.S. personal consumption expenditure price index and were also adjusted for regional price differences using regional price parity in accordance with the methodology provided by the Bureau of Economic Analysis. These are the 16 states where incomes are rising the fastest.
|Rank||State||10-yr. chg. in real personal income per capita (%)||Real personal income per capita, 2020 ($)||10-yr. workforce participation chg. (ppt.)||10-yr. chg. in avg. weekly hours worked (%)|