Last week the U.S. Department of Commerce’s Bureau of Economic Analysis released their preliminary 2010 personal income data (pdf) (which includes revisions to previous years).
The chart below shows the private sector share of personal income since 1929 (the first year of available data) to 2010 (the last year of available data). The opposite of the private sector is the public sector which is defined as all government compensation paid to employees (military and civilian) plus all personal current transfer receipts (Social Security, Medicare, Medicaid, Welfare, etc.).
As the chart clearly shows, the private sector has been steadily crowded-out by the public sector. Nationally, the private sector has plummeted 24 percent to 68.7 percent of personal income in 2010 from 92.7 percent in 1929. More troubling, 2010 is the lowest private sector share in history after dropping another 0.6 percentage points from 2009. How low will it go?
However, contrary to the national average, New Hampshire’s private sector is faring fairly well . . . at least given the circumstances. In 2010, New Hampshire has the largest private sector in the country (having surpassed Connecticut back in 2008). Additionally, the decline in New Hampshire’s private sector leveled off in 2010 while it continued to fall nationally. Now if New Hampshire can only get right-to-work enacted, then maybe we can get the private sector up back to over 80 percent 🙂