Thursday, May 7, 2015

Race to the Bottom: AZ now in bottom 10 states for per capita income

This morning's Daily Star has the report.

Arizona is now in the bottom 10 of all states for per capita personal income, the result of the jobs here paying less than those being created in the rest of the country.

The latest figures put Arizona at No. 41, said Lee McPheters, an economist from the W.P. Carey School of Business at Arizona State University. That’s because the U.S. Bureau of Economic Analysis puts average per capita income for 2014 at $37,895, 82 percent of the national figure.

The trend line isn’t encouraging, McPheters said, as he and other ASU economists gathered Wednesday to discuss the outlook for the coming year. In 1995 Arizona was 35th in the nation. It slid to 37th by 2000 and 38th five years after that. It hit No. 40 in 2007.

Arizona’s projected employment growth is in the 2.6 percent range this year, "the best that we’ve seen in this recovery," McPheters said. "But then you look at Utah. They’re growing (at) 4 percent. ... We’re just not keeping up with the pack."


As people move to Arizona, it creates a demand for service jobs, which are not high paying. "So we need some drivers for this economy" — like manufacturing jobs, McPheters said.

But even that is not an answer, said ASU economist Dennis Hoffman.

An increasing reliance on automation means companies have boosted their output by 25 percent since 2010 but have increased their payrolls by less than 5 percent, Hoffman said.


Hoffman also put in a plug for the state spending more on education.

He said teacher salaries in Arizona in the 1980s were actually above the national average. Now they’re at the bottom of all the states in the region and near bottom nationwide.

So with respect to what crAZy pays teachers, it has won a Race to the Bottom. But there is no limit to the bottom. The thing is: no one has told Il Duce and the GOPlins about the win - they're still in the race.

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