Swing States Income Decline
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According to Bloomberg, while most U.S. states experienced rising household incomes in 2023, Pennsylvania and Georgia, two key battleground states in the upcoming presidential election, saw a decline in typical household income after adjusting for inflation.
Impact of Inflation on Incomes
Inflation has disproportionately affected lower-income households in recent years. While lower-wage earners have seen larger wage gains, these increases have not fully offset rising prices for necessities. Lower-income families spend a larger share of their budgets on essentials like food, housing, transportation, and healthcare, which have seen significant price increases
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. From 2019 to 2024, the same set of necessities would cost low-income households 22% more, compared to 17.5% more for high-income households2
. This has squeezed budgets for many families, with nearly half of Americans reporting feeling "very stressed" by inflation3
. Middle-class and lower-income households have had to adjust spending habits, often by reducing discretionary purchases or seeking cheaper alternatives for everyday goods4
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. While slowing inflation provides some relief, the extended period of high prices has left many households, especially those with lower incomes, in a more precarious financial position.4 sources
Pennsylvania's Economic Challenges
Pennsylvania's economy continues to face significant challenges despite some positive trends. The state's unemployment rate has held steady at 3.4%, but income inequality remains a persistent concern.
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While Pennsylvania ranks sixth among states with the highest GDP, it lags behind competitors in supporting startups and converting that support into jobs.2
The state's aging population and slow population growth pose long-term demographic challenges to its labor force, with a projected decline in the working-age population.3
Additionally, Pennsylvania has struggled to fully recover from pandemic-era job losses, having lost 108,200 payroll jobs (1.8%) since February 2020, ranking it among the slowest states to regain employment.4
To address these issues, policymakers are focusing on strategies to boost economic growth, improve government efficiency, and build more resilient regions across the commonwealth.2
4 sources
Georgia's Income Growth Factors
Georgia's income growth has been sluggish in recent years, with the state ranking 50th in the nation for per capita personal income growth over the past decade. This slow growth can be attributed to several factors, including a high concentration of low-productivity jobs in sectors like agriculture and self-employment. About a third of Georgia's workers remain engaged in low-productivity agriculture, while the state also has a large share of self-employed individuals in other sectors
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. Additionally, skills mismatches are reported to be a significant impediment for most firms, limiting high-quality job creation1
. Despite these challenges, Georgia has seen some positive trends, with poverty rates declining from 70.6% in 2010 to an estimated 47.7% in 2022, and unemployment falling to a record low of 16.4% in 20231
. To address these issues and boost income growth, Georgia is focusing on improving its workforce, education, healthcare, and transportation infrastructure3
.3 sources
Related
What are the main drivers behind Georgia's income growth over the past decade
How has Georgia's job market recovery impacted poverty levels
What structural challenges does Georgia face in maintaining income growth
How does Georgia's reliance on tourism affect its economic stability
What role does the EU accession process play in Georgia's economic future
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