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Federal payroll increases helping San Diego incomes

Local think tank the National University System Institute for Policy Research released a study this week that found that an increase in federal payrolls, mostly to military service members, has helped keep San Diego's incomes slightly higher than most during the recession.

Using figures from the U.S. Department of Commerce's Bureau of Economic Analysis, NUSIPR researchers compared the personal income among San Diego residents with 366 other metro regions.

The data reportedly shows that overall San Diego personal income declined by $1.5 billion or 1.1 percent between 2008 and 2009. This puts San Diego, in percentage terms, somewhat better than the national decline of 1.8 percent.

According to NUSIPR, the better performance is largely a function of a $1.9 billion increase in federal payrolls in San Diego County, of which $1.5 billion was an uptick in the payroll of uniformed military. A large percentage of the remaining $400 million is associated to civilian employees of the Department of Defense as well.

NUSIPR researchers found that if San Diego's military payroll had held constant, personal income in the region would have dropped 3.1 percent, comparable to the 2008-09 figures seen in hard hit Sunbelt cities such as Phoenix and Miami.

"It is alarming to think about what San Diego would be like if military spending hadn't been increasing at the time of the downturn," NUSIPR Senior Economist Kelly Cunningham said. "Unemployment would be significantly worse in the region, as evidenced by how much more personal income would have fallen if not for the upswing in DOD expenditures."

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