What are the forces moving the Minnesota economy? Adam Belz tries to identify the trends and show the connections between Minnesota and the larger U.S. and global economies. You can connect with him on Twitter: @adambelz
Real per capita income is the federal government's best estimate of a person's wealth based on their income and the prices they must pay where they live.
For instance, $50,000 goes further in Sioux Falls than Miami, so someone with less income in Sioux Falls may have more real income than someone in Miami who earns a larger salary.
The Upper Midwest generally performs well in this measure, since prices are relatively low and personal income is relatively high, according to new data from the Bureau of Economic Analysis. The data also shows that real earning power diminished from 2007 to 2011 for Minnesotans, a fact accentuated by a quicker recovery of real personal income in North Dakota, South Dakota, Nebraska and Iowa since the downturn.
The new data are prototype estimates of real personal income, and the BEA is looking for feedback. You could think of it as a beta product launch, using price data and personal income figures to arrive at a real per capita income estimate in each state and major metro area in the U.S.
In 2007, Minnesota ranked sixth in the country and first in its region according to the measure, with real per capita income estimated at $41,000. It has since sank slightly to $40,600 per year, and has been surpassed by North Dakota, South Dakota and Nebraska. Iowa has nearly caught Minnesota too.
Minnesota, as the chart below shows, is still doing pretty well. It's ranked 9th nationally, and remains stronger than Wisconsin, Illinois, Michigan, and pretty much everyone else in the Midwest.