Personal Income MoM

Personal Income MoM is the monthly % change in US personal income, reported inside the Personal Income and Outlays news release. It belongs to the NIPAs, the National Income and Product Accounts, the national accounting framework, which ranks it a key monthly estimate alongside GDP. It covers income of resident persons, meaning households, nonprofits serving households, private welfare funds and private trust funds, from all sources. BEA compiles it from agency source data with no household survey, and it excludes capital gains while differing from after-tax income and spending.

One seasonally adjusted figure covers each calendar month, released about 4 weeks later in the last week of the next month. It is published at 8:30 a.m. Eastern Time under embargo, and dates slip when source data lag or closures intervene, sometimes alongside a GDP estimate. The release covers after-tax income in nominal and real terms, spending on goods and services, headline and ex-food-and-energy prices, outlays, and saving and its rate. Each release revises prior months with notes and revision tables, September updates cover 5 years, and comprehensive updates come about every 5 years.

7 BEA lines sum to the headline, shown in 6 bullets with pay lines merged, minus social insurance.

• Wage and salary disbursements and supplements: cash pay plus employer insurance and pension contributions, the fullest labor-cost picture.
• Proprietors' income with IVA and CCAdj: income of unincorporated owners, adjusted for inventory values and capital use.
• Rental income of persons with CCAdj: rents plus imputed owner-housing services, counted alike for owned and rented homes, the largest NIPA imputation.
• Personal income receipts on assets: dividends and interest paid to holders, with stock-price gains excluded.
• Personal current transfer receipts: government social benefits plus business transfers, such as Social Security, Medicare, Medicaid, and unemployment insurance.
• Less: contributions for government social insurance: employee and employer payroll contributions, subtracted as unavailable to spend.

In March 2021 (released April 30, 2021) personal income rose $4.21 trillion, or 21.1%. After-tax income rose $4.18 trillion, or 23.6%, while spending rose only $616.0 billion, or 4.2%. The release said government social benefits drove the gain, chiefly direct payments under the American Rescue Plan Act. Saving reached $6.04 trillion, a 27.6% rate, after January rose 10.3% and February fell 7.0%, so saved transfers, not paychecks, drove the spike.

1. Estimate components: build each line from source data, filling gaps by interpolation or extrapolation, with private pay from BLS data, and adjust for storm distortions.
2. Seasonally adjust: use agency adjusted data where given, else test with Census X-13 concurrent-factor software, then sum adjusted parts into an indirect total.
3. Annualize levels: multiply the monthly level by 12 to state seasonally adjusted annual rates, called SAAR, for cross-period comparison.
4. Compute the 1-month % change: divide PI_t, the month level, by PI_{t-1}, the prior level, subtract 1 and multiply by 100. For example, SAAR levels of $24,000.0 billion and $23,976.0 billion give -0.1%, while monthly cash flow is $1,998.0 billion, or SAAR divided by 12.