Michigan Is #7 in Income Growth, But...

The Bureau of Economic Analysis released 2nd quarter personal income growth data. The figures include revenue from all wages, dividends, benefits and transfer payments, and shows which states are growing the most.

Michigan grew to a remarkable 7th among the states — positive news considering the state's long economic decline. At .7 percent, it wasn't much growth, but the US average was .2 percent.

This apparent turnaround, however, is not good economic news. Michigan's increase is largely because of growth in transfer payments made to Michigan citizens, likely due to stimulus money and a greater amount of people drawing unemployment. Transfer payments increased by 8.6 percent. The data points showing what Michigan is making and selling in the marketplace — including wages and salaries, dividends, interest and rent, and employer-contributed benefits — were all down.

For other states, transfer payments just don't account for as much as they do in Michigan. Redistribution of wealth accounts for 18 percent of all income in the US, but it accounts for 23 percent in Michigan.

Transfers are important pieces of Michigan's economy, but economic growth needs to be done through the production and sale of goods and services. The latest release shows that this is down.

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