Georgia loses ground in per capita income compared to national average

By Maria Saporta

There’s one statistic that overshadows all others when it comes to measuring Georgia’s economic strength nationally.

That statistic is how Georgia’s per capita income compares to the national average per capita income.

In 2010, Georgia’s per capita income was $34,531 while the national per capita income was 39,791. That means that Georgians made 87 percent of the average income of the country as a whole.

For George Berry, improving Georgia’s per capita income is the key to the state’s future. Berry is a former commissioner of the Georgia Department of Industry, Trade and Tourism (now Georgia Department of Economic Development) who served in that role during the administration of Gov. Joe Frank Harris in the 1980s.

“You can put it in very simple terms — we don’t make enough money,” Berry said. “This has been our quintessential challenge over the years.”

Back in 1940, Georgians only earned 49 percent of the national per capita income. That percentage rose steadily until 1995 to 1997 when it reached a high watermark of 95 percent.

Since then, Georgia’s per capita income has dropped back down to 87 percent of the national average — back to where it was in 1983 and 1984.

Berry said the state needs to figure out “why we are sliding in relation to the rest of the country,” and then try to reverse that trend.

Annie Hunt Burriss actually began her economic development career working for Berry as one of the department’s first female project managers.

After three-decades working in economic development and higher education in Georgia, Burriss is now CEO of Prince William campus at George Mason University in Virginia.

Last week, she gave a farewell analysis to a group of leaders at All Saints Episcopal Church on how Georgia is faring competitively in economic development.

“I think Atlanta is at a real turning point, and Georgia is at a real turning point,” Burriss said. “It’s no longer about cheap land and cheap labor. There’s cheaper land, and there’s cheaper labor.”

Burriss said that when the Georgia Economic Development Association started in 1957, the state was “the armpit of the country.” Then, beginning in the early 1960s, there was series of progressive leaders in Georgia and Atlanta who worked to improve the state’s economic prosperity.

“We have had a wonderful history in Georgia of focusing on infrastructure,” Burriss said “We put infrastructure where it needed to be.”

Now it feels as though the state has taken a “hiatus” in investing in infrastructure.

“The thing I fear most right now is that we have gotten fat, dumb and happy,” Burriss said. “What are we doing to innovate our economy? If you look at what our investment strategy is right now, I don’t know what it is.”

Burriss said a real turning point happened during Gov. Harris’ administration when Georgia came in second to Texas for a major high-technology research center.

“It did make Gov. Harris to start rethinking the new economy is going to be about brains,” Burriss said.

That led state to make significant investments in higher education and research initiatives, and the needle began to move in Georgia’s favor.

“Our major challenges — education and infrastructure — contribute to our economic development, which contributes to higher income,” Berry said.

And if Georgians receive a higher per capita income, it puts the state on an upward spiral.

Today, if Georgians made just the average per capita income nationally, that would put more than $5 billion in the state’s economy every year. That would lead to more tax revenues with less a need for indigent services that burdens the state’s budget.

“We would solve many, if not most, of the problems in our state if we simply earned the national average,” Berry said. “And think about how many people would be living a better life.”

After talking to Berry and Burriss, it became clear that Georgia needs to recommit to investing in infrastructure and education — all the way from early education to higher education.

As an example, Berry pointed to the City of Atlanta’s investment in Hartsfield-Jackson International Airport (he was commissioner of aviation during the building of the new airport in the late 1970s and early 1980s).

The city has continued to invest in the airport, and that has reaped immeasurable economic development opportunities for the whole state.

“We need to get our mojo back,” Berry said. “Everything that comes to the governor’s desk, the question that must be asked is how does this move us to the per capita national income. People have telling us this for the history of our state. We were on the right trajectory, and now we are not.”

Georgia’s per-capita income:

(Percentage of national average)

1930: 49 percent

1935: 56 percent

1940: 56 percent

1945: 71 percent

1950: 70 percent

1955: 74 percent

1960: 74 percent

1965: 79 percent

1970: 83 percent

1975: 84 percent

1980: 83 percent

1985: 89 percent

1990: 91 percent

1995: 95 percent

2000: 94 percent

2005: 92 percent

2010: 87 percent*

Georgia’s per-capita income in 2010 was: $34,531

National per-capita income in 2010 was: $39,791

Georgia’s 2010 population: 9,815,210

Source: U.S. Department of Commerce, Bureau of Economic Analysis

Compiled by Susan Contreras