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Per Capita Transfer Payments

Description: 

Transfer payments (now referred to as “personal current transfer receipts”) is one of three primary categories of personal income. The category consists of payments to individuals and to nonprofit institutions by federal, state, and local governments and by businesses for which no current services are performed. According to the U.S. Bureau of Economic Analysis, “Government payments to individuals includes retirement and disability insurance benefits, medical payments (mainly Medicare and Medicaid), income maintenance benefits, unemployment insurance benefits, veterans benefits, and federal grants and loans to students. Government payments to nonprofit institutions excludes payments by the federal government for work under research and development contracts. Business payments to persons consists primarily of liability payments for personal injury and of corporate gifts to nonprofit institutions.”

Per capita transfer payments is calculated from transfer payments and population. It is a component of individual economic well-being that is of particular importance to retirees and to certain other individuals.

The latest current dollar per capita transfer payments figure by county is presented on Arizona Indicators, along with data for the same year for the United States, the U.S. metro average, the U.S. nonmetro average, and Arizona. The figure for Arizona also is expressed as a percentage of the national average. Counties within a metropolitan area are presented as a percentage of the U.S. metro average; the remaining counties are compared to the national nonmetro average. A history of Arizona’s current dollar figure as a percentage of the national average is presented back to 1969. In addition, the inflation-adjusted percent change in per capita transfer payments is displayed for each area, beginning with 1970. The data are inflation adjusted using the gross domestic product implicit price deflator (GDP deflator).

Data Source: 

U. S. Department of Commerce, Bureau of Economic Analysis. Preliminary annual data by state are released in March, with revised annual data reported in September. County data are released two months later, in November. All of the data can be accessed from http://www.bea.gov/regional/index.htm.

The GDP deflator is available from the U.S. Department of Commerce, Bureau of Economic Analysis: http://www.bea.gov/national/index.htm. Click on the “Interactive Tables: GDP and the National Income and Product Account (NIPA) Historical Tables” link; the GDP deflator is in Table 1.1.9 (Section 1: Domestic Product and Income).

Data Quality Comments: 

Some of the inputs to the calculation of transfer payments by state and county are estimated.

iconPer Capita Transfer Payments, 2013

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Visualization Notes:

Transfer payments can be divided into two categories. More than 70 percent of Arizona’s transfer payments in 2013 were of types that do not change much from year to year. This category particularly consists of retirement and disability payments and Medicare, and therefore is highly correlated to the proportion of retirees. In contrast, income maintenance, Medicaid, and unemployment benefits are highly countercyclical, rising during recessions and falling during economic expansions. In 2013 in Arizona, 29 percent of total transfer payments were of the countercyclical type.

Average per capita transfer payments in Arizona in 2013 was $7,395, slightly less than the national average of $7,638. In four of the state’s eight metropolitan counties, per capita transfer payments were greater than the U.S. metro average. In five of the seven nonmetro counties, the figure exceeded the U.S. nonmetro average.

iconPer Capita Transfer Payments as Percentages of the National Averages, 2013

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Visualization Notes:

Per capita transfer payments in 2013 ranged from 41 percent above the U.S. metro average in Cochise County to 11 percent below average in Maricopa County. Among the seven nonmetro counties, per capita transfer payments ranged from 45 percent above the U.S. nonmetro average in Gila County to 18 percent below average in Santa Cruz County.

iconPer Capita Transfer Payments in Arizona as a Percentage of the National Average

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Visualization Notes:

Since Arizona’s economy is more cyclical than the national average and since transfer payments in part consist of countercyclical components such as unemployment benefits and food stamps, per capita transfer payments as a percentage of the national average tend to be highest during economic recessions and lowest during economic expansions. From the 1950s through 2004, Arizona’s figure generally fluctuated between 5-and-15 percent below the national average. However, larger annual increases for 10 consecutive years from 2001 through 2010 put Arizona’s figure marginally above the U.S. average in 2009 and 2010. In 2013, Arizona’s figure was 3 percent below average.

iconPer Capita Transfer Payments, Inflation-Adjusted Percent Change

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Visualization Notes:

The inflation-adjusted percent change in per capita transfer payments is highly countercyclical nationally and in Arizona, with large increases common during recessions and small increases or decreases usually occurring during expansions. Typically, Arizona experiences larger increases during recessions and larger decreases during expansions than the national average. However, during the mid-2000s boom, per capita transfer payments continued to rise, by a little more in Arizona than the national average. The increases during the recession, from 2008 through 2010, were larger in Arizona. The real change in per capita transfer payments in Arizona and the nation was negative in 2011 and 2012, with Arizona’s declines a little larger than the national average in each year. A small increase was registered in 2013 in the nation, with a slight decrease in Arizona.

Data Source

U. S. Department of Commerce, Bureau of Economic Analysis. Preliminary annual data by state are released in March, with revised annual data reported in September. County data are released two months later, in November. All of the data can be accessed from http://www.bea.gov/regional/index.htm.

The GDP deflator is available from the U.S. Department of Commerce, Bureau of Economic Analysis: http://www.bea.gov/national/index.htm. Click on the “Interactive Tables: GDP and the National Income and Product Account (NIPA) Historical Tables” link; the GDP deflator is in Table 1.1.9 (Section 1: Domestic Product and Income).