Picture This: US Regional Income Shift

US median household income rose to $81,600 in 2024, reflecting an average annual increase of 4.4% since 2019. Growth was strongest in the South and West, where median incomes expanded 4.7% per year over the same period, compared with 4.2% in the Midwest and 4.1% in the Northeast. Every state and the District of Columbia recorded gains between 2019 and 2024. Idaho posted the fastest growth, while Wyoming registered the slowest.

For the first time since the American Community Survey series began in 2005, the South’s median household income reached parity with the Midwest’s in 2024. Both regions recorded $76,300, tying for lowest among the four Census regions. The West remained the highest at $92,800. The West surpassed the Northeast in 2018 and expanded its lead over the past five years.

The ongoing redistribution of population and purchasing power toward the South and Mountain West remains one of the most persistent structural trends in the US economy, and even a moderating pace of income growth is unlikely to reverse it in the near term.

The South’s convergence and the West’s continued outperformance reflect sustained in-migration of higher-earning households from the Northeast and high-cost coastal states. Lower housing costs, favorable climates, and more advantageous state tax structures have been powerful draws. Florida and Georgia halved their gaps to the national median over the five-year period.

Within the West Census region, the Mountain division led the nation with average annual growth of 5.2%. Arizona, Idaho and Nevada effectively eliminated their previous deficits to the national median, while Colorado and Utah — already above-average states — extended their premiums to 19.0% and 18.5% above the US level, respectively, by 2024. These states continue to benefit from high educational attainment and concentrations of employment in technology, financial activities and professional services.

In contrast, the Midwest and Northeast have been hampered by slower employment growth and persistent net out-migration to lower-cost regions. Even states that began the period well above the national average saw their premiums erode: Minnesota’s advantage shrank from 8.9% in 2019 to 5.5% in 2024, and Rhode Island’s from 5.5% to 1.9%.

—By Alexander Minelli

This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.