Report: High prices slice personal income in Conn.

HARTFORD, Conn. (AP) -- Personal income for Connecticut residents rose a weak 2.2 percent in 2011, lower than the rest of the United States, according to federal data released Wednesday.

The Department of Commerce's Bureau of Economic Analysis laid part of the blame on Connecticut's high cost of living that reduces purchasing power.

Real personal income in the United States increased an average of 2.7 percent in 2011. The growth rates reflect year-over-year changes in income adjusted by the change in spending.

In 2011, the Bridgeport-Stamford-Norwalk metro area posted the highest price parity, which is the measure of differences in prices of goods and services. Connecticut was seventh among the 50 states and Washington, D.C., in price parity. Hawaii, New York, Washington, D.C., New Jersey, Maryland and California were higher.

The rise in personal income in Connecticut in 2011 was lower than the 3.6 percent growth posted the previous year. In contrast, personal income growth nationally increased from 2010 to 2011.

New Haven economist Don Klepper-Smith said the data show why many people still struggle even in an improving economy.

"This lies at the core of why nearly half of all Americans are not seeing an economic recovery as they understand it," he said. "In this recovery, after the bills are paid, after the taxes are paid, there ain't a lot left over. It's the extra dinner out, maybe the long weekend on the Cape."

Daniel Kennedy, an economist at the state Department of Labor, said the federal statistics did not surprise him because job growth in Connecticut has been slowing.

"Connecticut is the laggard," he said.

The state's weak spots are the finance sector and its geographic proximity to New York's Wall Street, which was hit hard by the recession and weak recovery, and government, which cut jobs in schools and local government. The loss of federal stimulus spending also had an impact on government spending, Kennedy said.

In addition, the state's two Indian-run casinos, which have posted steadily declining revenue, also are counted as local government.

"Finance and government seem to be what's driving Connecticut down," he said.

The federal statistics follow by less than a week a batch of other numbers released by the Bureau of Economic Analysis showing that Connecticut was alone among the 50 states with a shrinking economy in 2012.