Gazette-Mail editorial: Everyone was wrong on income growth (including us)

In an editorial over the summer, we applauded the news that West Virginia had the best income growth rate in the country for the first quarter of 2019. But we tempered that with the context that growth rates here were largely linked to temporary economic boosts from construction.

We also explained an income bump in West Virginia can push percentage points up by a lot, because income rates across the state are typically lower than other places throughout the country.

Turns out, we were wrong. In fact, everyone was, because the data was incorrect.

On Tuesday, the U.S. Bureau of Economic Analysis — which had put out the information ranking the Mountain State first in income growth — adjusted its findings. West Virginians’ income didn’t grow by 5.6 percent for the first quarter. It grew by 1.5 percent, ranking it 47th in the nation. Furthermore, combined growth for the first two quarters of the year puts West Virginia 40th overall.

New Census data found wages in the Mountain State hardly moved, mostly because of the loss of 4,000 pipeline construction jobs — jobs that were giving a temporary boost to the economy.

Back in June, we told readers the numbers presented were worth celebrating, but also worth some caution. Still, we never imagined anything like this. Finding out the state wasn’t No. 1 is one thing, but finding out it was, indeed, 47th is a gut punch. The news is particularly ill-timed, adding insult to injury as state revenue numbers — which had been soaring to record heights — are now falling woefully short of projections. The all-too-familiar specter of a multi-million dollar budget shortfall is forming, coming off the first budget surplus in what feels like ages.

Again, state government officials are attributing the downturn in revenue to a drop in construction and a drop in severance taxes from the coal industry, both things economists warned would be coming by late 2019. No one should be happy they were right, but it does underscore the point of why forecasts are prepared and the need to plan accordingly.

When original news of the unprecedented income growth got out, Gov. Jim Justice asked, “How much more proof do we need that our days of being dead 50th are long gone?” Well, West Virginia isn’t 50th. It’s 47th for the first quarter and 40th for the first half of the year. That’s proof, of a sort, but not the type Justice meant nor the type West Virginia needs.

Funerals for Thursday, November 21, 2019

Bias, Kenneth - 7 p.m., Evans Funeral Home & Cremation Services, Chapmanville.

Carrow, Mildred - 1 p.m., Marmet Memorial Gardens, Marmet.

Coleman, Aaron - 1 p.m., Cooke Funeral Home Chapel, Cedar Grove.

Fore, George - 7 p.m., Keller Funeral Home, Dunbar.

Midkiff, Cleo - 2 p.m., Bartlett-Nichols Funeral Home, St. Albans.

Outman, Roxine -  2 p.m., Hafer Funeral Home, Elkview.

Shamblin, Cathy - 7 p.m., Christ Community Church, Scott Depot.