Kansas Income Growth Lags

By Karl Peterjohn

You will earn more if you do not work in Kansas. That is nothing new but the size and scope of the economic problem facing Kansans has become more vivid. National data has regularly shown that Kansans’ incomes are lower than the national average and this is impacting the economic climate in this state.

In September, Wichita State University’s Center for Economic Development and Business Research issued a report showing how badly Kansas lagged with the fastest and slowest growing parts of the United States. In this report Kansas vividly contrasted with fast growing Colorado in all of the measurements being used.

Colorado, which has been benefiting from their Taxpayers Bill Of Rights limits on state and local government spending increases, had the best economy in our region. Colorado was in the ten fastest growing states when total personal income, earnings per job, per capita income, full, and part-time job growth were measured. Naturally, jobs and income then have an impact reflected in Colorado’s fast growing population too.

What the Wichita State University study did not report was how Kansas measured when compared with all four of our immediate neighbors. This is bad news for Kansas.

Personal income growth is weak in Kansas. It is one of the lowest in the entire country at 43rd out of the 50 states plus the District of Columbia for a ten year time period ending in 2003. This federal data ranked Colorado as 3rd highest while our other three neighboring states ranked between 28th and 33rd.

Kansas was a dismal 41st and once again in the bottom 10 when it came to per person or per capita personal income. Colorado was once again in the top ten at number 9 while Nebraska was 12th, Oklahoma 19th, and Missouri 30th. Earnings by place of work was another measurement W.S.U.’s study examined and Kansas again scored badly. Kansas was worst in this region at 37th while Colorado was once again 3rd.

There was a bit of good news in job growth percentages since Kansas did not score at the bottom in our region. Missouri was at the regional bottom at 37th and Oklahoma was slightly worse than Kansas at 32nd. The growth in jobs could be attributed to other factors like Missouri and until recently Oklahoma both being states without Right To Work laws that have a positive impact upon job availability.

Jobs, wages, and income are all factors in a society where people can, and do, vote with their feet. Americans have always been a restless lot and the level of jobs, wages, and income are all important factors on where people decide to live. The W.S.U. study looked at population trends. In 1970, there were more Kansans than Coloradans. Today, there are 1.5 million more residents of Colorado than Kansas. During the 1990s in the hey-day of TABOR, Coloradans’ incomes soared and their population grew over 30 percent.

Government spending advocates like Governor Sebelius have cited the recent growth in state tax revenues as a sign that the Kansas economy is growing. Sadly, the 7.1 percent growth in state revenues in the fiscal year ending June 30 was less than half the national percentage growth in revenues. Tax revenues show a continuing relative decline for Kansas.

WSU’s survey indicated that Kansas had the lowest population growth in our five state region. This is not a surprise since there is a costly and highly uncertain fiscal climate to own or operate a business in this state. The judicial activism coming from the Kansas courts with a billion dollar price tag raises this uncertainty even higher and that is too recent for this data. Many liberals in Kansas claim that additional spending on government, particularly public schools, is the solution to economic growth. Higher government spending is much more connected with economic stagnation and decline. Kansas, with high property, income, and sales taxes, provides a regional model on why this state is lagging in wages, incomes and job growth and this is hurting population growth here.


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