Recent analysis from the Pew Charitable Trusts finds that economic growth outstrips income growth in every state. Between 2000 and 2013 North Carolina’s GDP grew by 2.3 percent, behind its neighbors Virginia and Tennessee but ahead of South Carolina and Georgia. However, North Carolina’s median income dropped – significantly – by 13.4 percent. The current gap between GDP and median income growth is 15.7 percentage points, one of the largest in the Southeast.
So, even though North Carolina workers are more productive, they’re not earning anything close to what they produce. The state’s economy is pulling further away from working- and middle-class families, while a shrinking portion of the population does better and better.
“Many economists point to growing income inequality. According to economist Lane Kenworthy of the University of California at San Diego, as the top 1 percent of income earners have gotten a larger portion of the country’s overall wealth, “household income growth for the middle has become decoupled from economic growth.”
These findings line up with Think’s report, A Comeback Short of the Mark, which found these and other negative income trends continuing in North Carolina through 2014. North Carolina’s income trends are “running in reverse,” and current public policy is only serving to exacerbate this backwards trend.