Skip to main content

North Dakota leads district in personal consumption expenditures

September 30, 2014


Rob Grunewald Economist, Community Development and Engagement (former)
Dulguun Batbold Research Analyst
North Dakota leads district in personal consumption expenditures

Robust income gains in North Dakota in recent years appear to be leading to strong increases in personal consumption, according to recently released prototype estimates by the Bureau of Economic Analysis (BEA).

In 2012, personal consumption expenditures (PCE) per capita in North Dakota were estimated at $44,029 (see Chart 1), which ranked third in the country behind Massachusetts and Connecticut. Four of five district states were above the national average; Wisconsin was the only state below the national average.

PCE CH1 -- 9-30-14

State rankings vary by consumption category (see table for examples). While Minnesota’s per capita consumption ranked 14th in the nation overall, its per capita consumption of food and beverages purchased for off-premises consumption ranked 45th, which suggests that Minnesotans buy fewer groceries than residents in other states. Meanwhile, North Dakota ranked 31st in spending for housing and utilities despite ranking third overall.

PCE table -- 9-30-14

However, it’s important to note that state rankings may reflect not only differences in the overall amount of consumption, but also differences in prices. For example, even though housing costs in the western part of North Dakota are high, costs in the state overall are still moderate relative to other states, a likely reason for the middle ranking for housing and utilities. But it’s not surprising that Montana and the Dakotas rank relatively high in gasoline consumption, considering that the states have a larger proportion of population living in rural areas and often have longer travel distances than more urban states.

From 1998 to 2012, PCE per capita decreased only during the last recession, except in North Dakota (see Charts 2 and 3). During 2011 and 2012, real PCE per capita in North Dakota increased about 7 percent annually, the strongest growth among U.S. states.

PCE CH2-3 -- 9-30-14

The BEA plans to conduct additional outreach with data users to assess these prototype estimates, review the estimation methodology and continue to make improvements. The BEA plans to release official PCE statistics in 2015, provided that user evaluations are positive.