nb_cid nb_clickOther -tt-nb this.style.behavior='url(#default#homepage)';this.setHomePage('http://www.aol.com/?mtmhp=acm50ieupgradebanner_112313 network-banner-empty upgradeBanner
14
Search AOL Mail
AOL Mail
Video
Video
AOL Favorites
Favorites
Menu

Oil boom and housing bust alter US spending trends



By CHRISTOPHER S. RUGABER

WASHINGTON (AP) - North Dakotans, enriched by an oil boom, stepped up their spending at triple the national pace in the three years that followed the Great Recession. In Nevada, smacked hard by the housing bust, consumers barely increased their spending.

Americans spend the most, per person, on housing in Washington, D.C., and the least in West Virginia.

Those and other figures emerged Thursday from a new annual report from the government that for the first time reveals consumer spending on a state-by-state basis from 1997 through 2012. The numbers point to substantial shifts in the economy since the recession ended. The recession, which began in December 2007, officially ended in June 2009.

Spending jumped 28 percent in North Dakota, the largest gain nationwide, from 2009 through 2012. It surged nearly 16 percent in Oklahoma. The next-largest increases were in South Dakota, Texas and West Virginia.

The changes in spending patterns in North Dakota have been particularly dramatic. Its per-capita spending in 2007, before the recession began, was $32,780. That ranked it 24th among states. By 2012, North Dakota's per-capita spending was $44,029, fourth-highest nationwide. (The figures aren't adjusted for inflation.)

North Dakota has boomed in large part because of a breakthrough drilling technique, known as hydraulic fracturing, or "fracking," that has unlocked vast oil and gas reserves. The state's per-person income soared 37.2 percent, before inflation, from 2009 through 2012, according to a separate report released this year. That's by far the most for any state. North Dakota's unemployment rate was a barely visible 2.7 percent in June, the lowest in the nation.

By contrast, spending eked out a scant 3.5 percent increase in Nevada, the weakest for any state and far below the 10.7 percent national average. Arizona's 6.2 percent increase was next-weakest, followed by Hawaii's, Florida's and Utah's.

When the housing bust struck in 2006, home values plummeted in Nevada, Arizona and Florida. The persistently weak consumer spending in those states underscores the lingering damage the housing bust inflicted on their economies.

Nevada and Arizona also received the smallest income gains in the first three years after the recession ended. Salaries and other income in Nevada rose just 3.8 percent and in Arizona, 6.7 percent. The national average was 11.1 percent.

And Nevada's unemployment rate was 7.7 percent in June, the third-highest. Arizona's was 6.9 percent, 10th-highest.

The government's figures show that state-by-state spending patterns were radically different before the recession. In the three years leading up to the downturn, for example, spending in Arizona jumped 21.2 percent, the fourth-highest in the nation. Big home price gains during the housing bubble likely fueled more spending.

North Dakota's spending growth was only 12th-highest in those years. Spending rose the most in Wyoming, where it surged 24.5 percent, followed by Louisiana and Hawaii.

The report points to wide spending disparities elsewhere in the country. Per-person spending in 2012 was highest in Washington, D.C., at $59,423, followed by Massachusetts at $47,308. The next-highest per-person spending totals were in Connecticut, North Dakota and New Jersey.

Spending was lowest that year in Mississippi, at $27,406. Arkansas was second-lowest, at $28,366.

The government's new report includes figures for specific spending categories. For example, in 2012, consumers spent the most on housing and utilities in Washington, D.C., where per-capita spending reached $11,985, followed by Hawaii at $10,002. Connecticut and Maryland ranked third and fourth. Those figures largely reflect high rents in those areas.

The individual categories of spending data tend to coincide with regional cost-of-living differences. Consumers in Alaska, where food costs are generally high, spent the most on groceries, laying out $3,852 in 2012, followed by Vermont at $3,622, followed by New Hampshire, $3,616, and Hawaii, $3,615.

The cold-weather state of North Dakota led the nation in spending on gas and energy, paying a per capita $3,916 in 2012. Wyoming, South Dakota and Maine spent the next-largest amounts.

Hawaii spent the least, at just $882, followed by New York, Florida and California.

Join the discussion

1000|Characters 1000  Characters
champ3x7 August 08 2014 at 1:32 AM

Interesting. The four states ranked highest on this chart are states with republican governors and strong conservative values. 8 of the top 10 on the list also have republican governors. Just sayin'.

Flag Reply +13 rate up
1 reply
baitmaster1951 champ3x7 August 08 2014 at 9:00 AM

And most of the big cities that are in financial straits are run by Dem's. But facts don't matter to the KoolAid left.

Flag Reply +1 rate up
2 replies
jaded13640 baitmaster1951 August 08 2014 at 9:58 AM

You really summed it up well there baitmaster. The facts fly right over their heads. You point out to a leftie that obamacare is a disaster for a multitude of reasons using facts and they'll call you a racist. I was telling one guy who I assumed was a republican voter, boy was I wrong about that, that if we didn't take back the senate we'd never get rid of obamacare. He asked, "what's wrong with obamacare?" I thought he was joking. I said "seriously?" He was. I said "God, I don't even know where to begin...how about the fact that we don't have enough doctors now and the program is still in it's infancy. What's going to happen when millions more start calling on the doctors we have?" He shrugged it off. I asked "and who's going to pay for it?" Without missing a beat he replied, "well the 2% of course." I just stared at him with my mouth hanging open. I said "don't you realize that even if they took every penny from everyone in so called 2% bracket it wouldn't even come close?

Flag 0 rate up
jaded13640 baitmaster1951 August 08 2014 at 10:02 AM

Needless to say he didn't believe that. He said, "all I know is before obamacare I couldn't afford insurance and now I can." I said "ok, how much is your deductable?" Of course he didn't know the answer to that. People don't seem to realize that the premiums may be a bit less but that they're never actually going to meet their deductable so for most and for all intents and purposes they don't actually have health care unless their in the bottom teirs. That went right over his head too. The guy actually though NPR to be a neutral or better put "fair and balanced" news outlet. I said, "dude...NPR is about as left biased as they come!" Of course he didn't believe that either. It's sad how well the left has brainwashed their followers.

Flag 0 rate up
ectullis August 08 2014 at 8:21 AM

Are you better off now then you were five or six years ago? I'm not. OMG

Flag Reply +7 rate up
kenmcc2 August 08 2014 at 6:45 AM

Duh...a robust economy will enable people to increase their incomes, spending and saving more. Econ 101.Too bad we are too caught up in political arguments to realize the simple fact: National policies under Obama are not conducive to expanded economic growth but are more focused on expanding the reach of the government sector into our lives. The economy is growing a little faster but this is in spite of current economic policies. There is much more we could do to enable these pockets of solid growth to expand across the nation.

Flag Reply +5 rate up
plybon72 August 08 2014 at 12:50 AM

But wait,, that cannot be true. I have heard from republicans that Obama will not allow anyone to drill for oil and gas!

Could it be that someone is lying??

Flag Reply +3 rate up
5 replies
Rick August 08 2014 at 9:56 AM

Everyone who has a 401 and or a stock portfolio knows the pain caused by our current King Obama and his band of thiefs. Get the democrts out of office and Americans again will proster even the ones not in oil states.a

Flag Reply +2 rate up
1 reply
kcarthey Rick August 08 2014 at 1:19 PM

Are you crazy? I'm in the process of buying a second retirement/vacation home thanks to the growth in my retirement fund since the President took office. I'm "prostering" very well as are most Americans.

Flag Reply 0 rate up
James Lewman August 08 2014 at 3:09 AM

hey one percent what will you do when you realize we are too poor to buy your ****?

Flag Reply +2 rate up
Mike August 08 2014 at 5:03 AM

Frack you, North Dakota!

Flag Reply +1 rate up
LL August 08 2014 at 1:45 PM

WYOMING is another fossil fuel rich state, and just between these two states, the United States now has the ability to become "The World's Biggest Natural Gas & Oil Producer" overnight, so, (just as I've predicted a couple of years ago, and now is being revealed) - Americans will soon attain the Saudi Arabian miniscule gas prices at the pump status, and we'll all soon be driving expensive new gas hog cars - simply because we can afford to do so - therefore, steering our children into the fossil fuel industry careers, is just as sound a proposal - as teaching Mandarin Chinese as our 2nd language,...and I'll save the reason for that one, in my future posting ...

Flag Reply +1 rate up
kate August 08 2014 at 12:40 PM

We can't all be in electric cars by tomorrow. In the interim, if we choose to transition to alternative fuel cars, we can drill here, keep it here, buy it here, creating jobs and cutting the middle east out of the equation. And worry later about how to handle all the extra electricity we will would need if everyone in the US plugged in a car tonight. I just know my electric bill is 4x higher in the summer with rate increases and higher demand.

Flag Reply 0 rate up
jgesselberty August 08 2014 at 10:14 AM

Too bad that the spending increases are probably for cell phone bills. LOL

Flag Reply 0 rate up
aol~~ 1209600

Voting...

More From Our Partners