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Article published Mar 30, 2005
State's per capita income below bar

COLUMBIA -- Incomes in South Carolina continue to lag behind those in the rest of the nation, according to new federal data.The state's per capita income was $27,172 in 2004, or about 82.5 percent of the U.S. average. All but seven states posted a higher figure, according to the U.S. Bureau of Economic Analysis.In 2003, South Carolina's per capita income was 83.1 percent of the U.S. average, the smallest gap in more than 30 years.Per capita income includes wages, investment gains and government benefits, such as Social Security payments to retirees.The statistic gained attention in 2002 when the Palmetto Institute singled out per capita income as a key measure of the state's economy. Republican Mark Sanford was elected governor that fall after campaigning to raise the incomes of average South Carolinians.Some initiatives suggested in a study conducted on behalf of the Palmetto Institute have begun to take root.The study by Harvard Professor Michael Porter and the Monitor Company group called for building "clusters." Groups with members from educational to business organizations work collaboratively to bolster such industries as automotive, chemical products, textile and tourism.Spartanburg Mayor Bill Barnet, who serves on the S.C. Council onCompetitiveness formed to carry out some of the study's proposals, says progress is being made.Barnet cited the automotive cluster that led Clemson University to develop the International Center for Automotive Research through collaborating with BMW, Michelin and IBM on a 400-acre site in Greenville. The center could help boost the area as a hub for automotive education, research, design and technology."That's the kind of thing I think is taking us in the right direction," Barnet said. "…We are starting to do the kinds of things that will lead to a change in per capita income formula."The state's per capita income grew 1.2 percent last year after adjusting for inflation, compared with 1.9 percent for the nation.University of South Carolina economist Don Schunk said the state fell behind because its population grew faster while its employment grew slower than the rest of the nation."I don't think we can look at 2004 and say that our economic development plans for the state are a failure," Schunk said. "Certain aspects of South Carolina's economy, such as heavy reliance on manufacturing, especially (textiles and other nondurable goods), worked to hold back job growth."In addition, gross pay for all employees in South Carolina was about $30,700, or 82 percent of the U.S. average, during the first three months of last year, according to the latest data available from the U.S. Bureau of Labor Statistics. That's worse than in 2003, when South Carolina workers made about 83 percent of the U.S. average, but better than 2001 when they made 80 percent.The Palmetto Institute, which is made up of state business leaders, supports measures to improve workers' skills, raise investments in research and provide greater access to money for new companies in emerging fields.It has not taken a position on specific issues, such as raising the minimum wage or cutting the state's income tax rate, which the Governor's Office says will improve per capita income.