December 3, 2012
Even though inflation ate up a sizable chunk of it during a slow economic recovery, personal income for the average Wilkes-Barre/Scranton area resident increased modestly last year.
According to data recently released by the U.S. Department of Commerce‚??s Bureau of Economic Analysis, personal income per capita in the region rose 4 percent from 2010 to 2011, which is the latest data available.
Wilkes-Barre/Scranton didn‚??t fare as well as the nation on a whole, which saw a 4.4-percent increase in per capita income.
‚??But that beats inflation, so anything above the inflation rate is good news,‚?Ě said Anthony Liuzzo, director of the master of business administration program at Wilkes University.
The inflation rate in 2011 was 3 percent.
So, while the average per capita income for the Scranton/Wilkes-Barre Metropolitan Statistical Area increased from $35,460 to $36,889, the average resident saw his or her annual spending power increase by about only $286 instead of the full $1,429 because of inflation.
Still, that $286, which averages out to about $24 a month, can have a positive effect on the local economy.
‚??What it does is it has a ripple effect. What happens is people save a piece of it, but they spend most of it. When a person‚??s income goes up, they spend it, whether it‚??s on a new sweater or something for a family member. Then someone who sells the sweater works more hours and they spend that extra money,‚?Ě Liuzzo said.
‚??With the multiplier effect, it does cause the economy to expand. If that happens, it creates jobs and, the more jobs there are, the better they feel about their world, and they spend more money,‚?Ě he said.
Based on the data, Liuzzo said, local economic recovery is ‚??in good shape. But I‚??m not doing cartwheels here, either. We have to get the unemployment rate down.‚?Ě
Even though thousands more people are working in the metro area than a year ago, a recent report by the state Department of Labor & Industry said the area‚??s jobless rate increased in September to 9.6 percent, matching the highest it‚??s been since June 2010.
‚??When looking at the unemployment rate and home sales, we‚??re moving in the right direction on both those indicators, but not fast enough, certainly,‚?Ě Liuzzo said.
Liuzzo said it‚??s also good news that Scranton/Wilkes-Barre is in the top half of metro areas across the country when it comes to personal income growth. The Scranton/Wilkes-Barre metro area ranked 179th out of 363.
‚??That‚??s certainly better than being in the bottom (half),‚?Ě Liuzzo said.