Regional

BEA uses Census Bureau midyear (July 1) resident population estimates for states and counties to calculate per capita personal income estimates. Each new series of data (called vintages) incorporates the latest administrative record data, geographic boundaries, and methodology. Therefore, the entire time series of estimates beginning with the most recent decennial census is revised annually.

The 2020 Q1 estimates of State Personal Income were impacted by the response to the spread of COVID-19, as governments issued “stay-at-home” orders. This led to rapid changes in employment and earnings as businesses switched to remote work or canceled operations, and consumers canceled, restricted, or redirected their spending.

There are several differences between the SIC and NAICS estimates, which may affect the industry estimates as well as the state totals. First, these are two different industry classifications, and as such, industries classified in one sector on SIC may be classified in another sector on NAICS. Second, the data sources and estimation methods used for NAICS may differ from those used to produce the SIC estimates. Finally, the NAICS-based estimates are consistent with national GDP while the SIC-based estimates are consistent with national gross domestic income (GDI).

The U.S. Office of Management and Budget defines metropolitan [statistical] areas as standardized county or equivalent-based areas having at least one urbanized area of 50,000 or more population, plus adjacent territory that has a high degree of social and economic integration with the core, as measured by commuting ties. For more information on how metropolitan areas are defined, see http://www.census.gov/population/www/estimates/metroarea.html.

The county earnings data used for the estimation of GDP by metropolitan area are from BEA’s local area personal income accounts (available at www.bea.gov/iTable/iTable.cfm?reqid=70&step=1&isuri=1&acrdn=5#reqid=70&step=1&isuri=1). Earnings by place of work is the sum of wage and salary disbursements, supplements to wages and salaries, and proprietors' income.

Growth rates measure the increase in GDP over a given time period as a ratio of GDP for the first year of the time period. Therefore, a modest increase in the GDP of a small MSA will indicate a fast growth rate because the denominator of the ratio is small. For example, assume two metropolitan areas experienced the same amount of growth in dollars and that one area is significantly smaller than the other. In the formula below to compute percent change, the numerator (the amount of growth) will be the same for both areas.

No, the ratio of GDP to earnings for each state and industry differs. As the formula below shows, the GDP by state to earnings ratio differs for each industry, state, and year.

where

cnty = county;

msa = metropolitan area;

i = industry;

st = state; and

yr = year.

The formula used by BEA to calculate the average annual growth is a variant of the compound interest formula:

where

GDP_t is the level of activity in the later period;

GDP₀ is the level of activity in the earlier period;