We conclude our look at the components of income data from our new annual report with how residents of metro Lansing earn their income. We use the broadest definition of the region which includes four counties: Clinton, Eaton, Ingham and Shiawasee.
Per capita income for metro Lansing in 2009 was $33,273. By major components it was:
- Private sector employment earnings $16,672
- Government employment earnings $7,769
- Dividends, Interest, Rent $4,796
- Transfer payments $6,952
We also looked at per capita income growth between 1989 and 2009 corrected for inflation. Over that 20 year period real per capita income grew by $5,351. An increase of 19 percent. By component the twenty year growth was:
- Private sector employment earnings $829
- Government employment earnings $1,222
- Dividends, Interest, Rent $2
- Transfer payments $3,721
As you can see, transfer payments account for a large proportion (69 percent) of metro Lansing’s real personal income growth over the past two decades. The other obvious highlight (really lowlight) is small real growth (a little more than 5 percent) over two decades in private sector employment earnings. The region’s private sector employment earnings are 29 percent below the national average. Both of these trends need to change if metro Lansing is going to be a high prosperity region.
In 2009 73 percent of metro Lansing’s personal income came from employment earnings (50 percent from private employers and 23 percent from government employers.) Transfer payments were 21 percent. And if you combine transfer payments and government employment earnings, you find that 44 percent of the region’s personal income is paid for with government revenue. Twenty years earlier employment earnings were 81 percent of personal income (57 percent from private employers and 24 percent from government employers.) Transfer payments were 12 percent. And personal income paid for with government revenue was 35 percent.
How does metro Lansing compare to the US? Not well! The region’s per capita income is now $6,362 (16 percent) below the national average. Over the past two decades the region’s real per capita income grew $2,446 slower than the nation. About two-thirds the growth the country experienced. By component compared to the nation the 2009 levels and 20 year growth were:
- Private sector employment earnings -$6,655/-$2,684
- Government employment earnings $2,536/$302
- Dividends, Interest, Rent -$2,347/-$718
- Transfer payments -$32/$616