Per Capita Personal Income in Oregon’s Counties
December 8, 2022In 2021, Oregon had a per capita personal income (PCPI) of $61,596. Oregon’s PCPI ranked 25th in the U.S. and was 96% of the national average of $64,143, according to the U.S. Bureau of Economic Analysis. In Oregon, the 2021 PCPI increased by 8.1% from 2020, faster than the nationwide PCPI growth rate of 7.3%.
Personal income is the sum of three main components: net earnings (wages, salaries, employer contributions); personal current transfer receipts (retirement, Medicare, unemployment insurance); and income from dividends, interest, and rent. PCPI is calculated by dividing the area’s personal income by its total population.
Per capita personal income varies between states and counties, and by metro and nonmetro areas. In general, PCPI is higher in the Portland area, the Columbia Gorge, and Central Oregon’s Bend area. Washington County had the highest PCPI in 2021 at $71,537, followed by Clackamas ($71,504), Multnomah ($70,331), Deschutes ($67,743), and Sherman ($67,558) counties.
The three major components of per capita personal income – net earnings; transfer receipts; and dividends, interest, and rent – make up different portions of counties’ PCPI. In general, counties with higher PCPI have a higher share of income attributable to net earnings. Per capita net earnings made up 67% of PCPI in Washington County and 63% in Multnomah County. In Wheeler County, net earnings made up just 37% of PCPI.
Areas with a higher concentration of older residents tend to have lower PCPI. The reason an older population tends to have lower PCPI is that as people leave the labor force, they have often passed their peak earning years, and therefore have less contribution to the net earnings component of PCPI. Remember, PCPI represents income rather than wealth. Older residents may have substantial wealth but do not have as much relative income, unless it was income-generating investments that would show up in the “dividends, interest, and rent” portion of PCPI.
Income from transfer receipts is generally higher in counties with lower PCPI. These transfer receipts are primarily government social benefits, such as Social Security (retirement), Medicare (health insurance program for people age 65 or older), Medicaid, and unemployment insurance. The initial impulse is to presume that folks in some counties rely more heavily on government subsidies; however, the story behind the higher transfer receipts is one of age demographics.
In rural Oregon, the share of the population that is age 65 and older increased from 19% in 2011 to 24% in 2021. A higher share of retirees means a higher share of transfer receipts. The share of per capita income from transfer receipts was higher in Wheeler (44%), Malheur (44%), Jefferson (42%), and Curry (41%) counties. The lowest share of per capita transfer receipts was in Washington (16%) and Clackamas (17%) counties.
Income from dividends, interest, and rent was highest in Benton (24%), Curry (23%), Deschutes (23%), and Hood River (23%) counties. It was lowest in Morrow (10%), Columbia (12%), and Umatilla (12%) counties.
Metro and Nonmetro
Metro areas across Oregon tend to have higher per capita personal income than nonmetro areas. In 2021, nonmetro areas ($50,694) in Oregon had PCPI that was just 80% of the metro figure ($63,733). In the U.S., PCPI of nonmetro areas amounted to 75% of the metro PCPI.
Comparing metro Oregon with other metro areas across the nation, however, we see that Oregon’s metro PCPI lags the nation and has for a while. In fact, Oregon’s metro areas’ PCPI was 88% of the national metro-area PCPI in 2011 and 96% in 2021.
On the nonmetro side, Oregon’s PCPI kept pace with the national average for nonmetros. PCPI in Oregon’s nonmetro areas was 93% of U.S. nonmetro in 2011 and 101% in 2021.
As shown in the table, net earnings make up the highest share of PCPI for all areas. However, net earnings make up a higher share of PCPI for metros than nonmetros, while transfer payments make up a higher share for nonmetros than metros.
The COVID-19 Impact on Personal Income
From 2020 to 2021, personal income rose both nationwide (+7.5%) and in Oregon (+8.2%). Since 2019, prior to the pandemic, income increased15% nationwide and grew 18% in Oregon. The sources of personal income changed, however, due to pandemic-related restrictions and the resulting slowdown in the economy. Fewer people earned income from work, dividends, interest, and rent. More income was received through transfer payments in 2020 and 2021, like federal stimulus funds and unemployment benefits, than during 2019.
Nationwide, the share of personal income from earnings dropped from 63% of total income in 2019 to 60% in 2021. Dividends, interest, and rent also fell from 20% of total income in 2019 to 18% in 2021. At the same time, transfer receipts rose from 17% in 2019 to 22% in 2021.
Statewide in Oregon, the share of personal income from earnings fell from 61% of total income in 2019 to 58% in 2021. Dividends, interest, and rent also fell from 20% of total income in 2019 to 18% in 2021. Transfer receipts climbed from 19% of total income in 2019 to 24% in 2021.