Income gains are reported

Idaho saw the highest rise in personal income in the West during the final three months of 2009, the U.S. Bureau of Economic Analysis reported on Thursday.

This could be a sign that the decline of the state’s economy is at an end, said Bob Fick, spokesman for the Idaho Department of Labor.

“It would appear that’s part of the economy bottoming out and starting to see recovery,” Fick said. “Everything runs its course. I couldn’t tell you the ins and outs of why it’s run its course. I don’t think anybody could.”

The USBEA estimated Idaho’s fourth quarter personal income at $49.3 billion on an annualized basis, up 1.2 percent from the third quarter — the strongest growth in all but six other states.

Nationally, personal income rose just 0.9 percent.

This is the first time the state’s total personal income has bumped up since mid-2008.

“It may not be very great — 1.2 percent isn’t any real great shakes in personal income,” Fick said. “But compared to five quarters of decline or flat, it is a good sign.”

The increase is also impressive because Idaho’s personal income plummeted so magnificently the rest of the year, Fick pointed out.

The USBEA estimated that Idaho’s personal income in 2009 fell 3 percent from the year before, dropping $1.5 billion to $48.9 billion.

Personal income only slipped 1.7 percent nationwide.

Last year was also Idaho’s first annual decline in personal income since 1969.

“Considering we went down fairly low, the (fourth quarter) increase is magnified,” Fick said. “But still, it’s a better increase than almost all the other states, and that bodes well. If that can continue, that helps us get out of this.”

Idaho’s wages and business profits for 2009 fell more than $2 billion. Investment earnings were down $750 million.

Those drops were partially offset by increases in unemployment benefits and other government payments like food stamps, Fick said, adding that a record $643 million was paid in unemployment.

“That’s the purpose of those programs, to offset contractions so that workers remain in the labor market so they are ready to go back to work when the economy recovers,” he said. “For every $80,000 in unemployment benefits, a job is saved.”

There is no telling when the state will see a full recovery, he added, which will depend on new job generation and wage increases.

“The whole thing is about, ‘What is recovery?’ When you stop shedding jobs, or when you’re back ahead to where you were before you started the decline?” Fick said. “We’ve stopped shedding jobs, at least. But it probably won’t be until 2014 we get to that other definition of where we were before this recession.”