First Official Real Personal Consumption Expenditures by State Reveal Pandemic's Varied Impact

Introduction of New Statistics

The U.S. Bureau of Economic Analysis has for the first time published official statistics on real personal consumption expenditures by state, covering the years from 2008 through 2020. These figures adjust current-dollar personal consumption expenditures using regional price parities and the national personal consumption expenditures price index to provide a measure in constant dollars.

The new data series allows for a clearer understanding of consumption patterns across states after accounting for differences in price levels. Previously, such adjusted figures were not available at the state level in this form, limiting direct comparisons of real consumption growth or contraction. The release coincides with updated estimates for real personal income by state and metropolitan area, incorporating revisions to source data and methodology.

National and State-Level Changes in Real PCE

For the nation as a whole, real personal consumption expenditures decreased by 3.8 percent in 2020, following an increase of 2.2 percent in 2019. This downturn occurred in 47 states and the District of Columbia, with only three states recording gains. The variation across states was substantial, ranging from an increase of 2.2 percent in Utah to decreases of 7.0 percent in Hawaii, Maryland, and New York. The District of Columbia experienced an 8.9 percent decline.

The states that saw increases in real personal consumption expenditures were Utah, Idaho, and Montana, with growth rates of 2.2 percent, 2.0 percent, and 1.0 percent, respectively. In these states, current-dollar personal consumption expenditures rose while the implicit regional price deflators fell. By contrast, the states with the largest contractions saw current-dollar personal consumption expenditures decrease alongside increases in their implicit regional price deflators.

Real Personal Income Growth Nationwide

In contrast to the decline in real consumption, real personal income increased by 5.3 percent nationally in 2020, up from 2.6 percent growth in 2019. This expansion was observed in all 50 states and the District of Columbia. The largest increases occurred in Idaho at 9.8 percent and Utah at 9.0 percent, both of which also benefited from decreases in their implicit regional price deflators.

The smallest gains in real personal income were recorded in Alaska at 1.6 percent and in Oklahoma. These more modest increases coincided with rises in the implicit regional price deflators for both areas. The divergence between consumption and income trends reflects the unusual economic conditions of 2020, during which government pandemic assistance payments supported household incomes even as consumption patterns shifted.

Role of Regional Price Parities and Deflators

Regional price parities measure differences in price levels across states for a given year, expressed as a percentage of the national price level. They are derived from consumer price index data for various goods and services, combined with housing rent information from the American Community Survey, using a multilateral aggregation method. In 2020, the highest regional price parities were in Hawaii at 112.0, New Jersey at 111.2, and California at 110.4, with the District of Columbia at 111.5. The lowest were in Mississippi at 87.8, West Virginia at 88.0, and Arkansas at 89.2.

For housing rents specifically, California recorded the highest regional price parity at 160.2, while Mississippi had the lowest at 56.1; the District of Columbia stood at 168.9. The implicit regional price deflator, calculated as the product of the regional price parity and the national personal consumption expenditures price index, serves as a measure of regional inflation when examining year-to-year changes. These adjustments are critical for converting nominal figures into real terms that reflect actual purchasing power.

COVID-19 Context and Data Limitations

The 2020 estimates for both real personal consumption expenditures and real personal income were influenced by the public health response to the coronavirus pandemic, including stay-at-home orders and government assistance programs. However, the full economic effects cannot be isolated within these statistics, as they are embedded in the underlying source data.

Updates to the real personal income series for 2008 to 2019 were also released, reflecting more complete source data from annual revisions to national, state, and local area accounts, as well as changes to regional price parity estimation methods. Future releases will incorporate population estimates based on the 2020 census when available. The new statistics provide a foundation for analyzing regional economic performance adjusted for price differences, though they do not separately quantify pandemic impacts.

Source

U.S. Bureau of Economic Analysis published this record on 2021-12-14. Pennington Financial accessed it on 2026-10-22.