This Morning’s Key Economic Data - Personal Income and Spending (November 2010)
December 23, 2010 – This Morning’s Key Economic Data – Personal Income and Outlays (November 2010) – The number for spending came in just shy of expectations at a 0.4% increase (expectations were for 0.5%). Spending outpaced income growth, which has negative implications for the savings rate. The short-sighted, and majority view on the economy is that this is ok, since consumers have a lot of heavy lifting (represent 70% of GDP, which requires them to spend 90%+ of their discretionary income). What is a little more debt, right?
Personal Income and Outlays, November 2010
Personal income increased $42.3 billion, or 0.3 percent, and disposable personal income (DPI) increased $37.8 billion, or 0.3 percent, in November, according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE) increased $43.3 billion, or 0.4 percent. In October, personal income increased $49.5 billion, or 0.4 percent, DPI increased $39.3 billion, or 0.3 percent, and PCE increased $68.9 billion, or 0.7 percent, based on revised estimates.Real disposable income increased 0.2 percent in November, the same increase as in October. Real PCE increased 0.3 percent in November, compared with an increase of 0.5 percent in October.
Wages and salaries
Private wage and salary disbursements increased $6.6 billion in November, compared with an increase of $31.2 billion in October. Goods-producing industries' payrolls decreased $3.0 billion, in contrast to an increase of $3.8 billion; manufacturing payrolls decreased $1.9 billion, in contrast to an increase of $2.6 billion. Services-producing industries' payrolls increased $9.6 billion, compared with an increase of $27.4 billion. Government wage and salary disbursements increased $0.8 billion, compared with an increase of $3.2 billion.
Other personal income
Supplements to wages and salaries increased $2.7 billion in November, compared with an increase of $5.0 billion in October.Proprietors' income increased $7.2 billion in November, compared with an increase of $8.2 billion in October.Farm proprietors' income increased $4.0 billion, compared with an increase of $4.1 billion.Nonfarm proprietors' income increased $3.1 billion, compared with an increase of $4.2 billion.Rental income of persons increased $2.1 billion in November, compared with an increase of $2.0 billion in October. Personal income receipts on assets (personal interest income plus personal dividend income) increased $16.8 billion, compared with an increase of $6.5 billion. Personal current transfer receipts increased $6.9 billion, in contrast to a decrease of $1.9 billion.Contributions for government social insurance -- a subtraction in calculating personal income -- increased $0.7 billion in November, compared with an increase of $4.6 billion in October.
Personal current taxes and disposable personal income
Personal current taxes increased $4.5 billion in November, compared with an increase of $10.3 billion in October.
Disposable personal income (DPI) -- personal income less personal current taxes – increased $37.8 billion, or 0.3 percent, in November, compared with an increase of $39.3 billion, or 0.3 percent in October.
Personal outlays and personal saving
Personal outlays -- PCE, personal interest payments, and personal current transfer payments – increased $45.9 billion in November, compared with an increase of $71.3 billion in October. PCE increased $43.3 billion, compared with an increase of $68.9 billion.
Personal saving -- DPI less personal outlays -- was $614.8 billion in November, compared with $622.8 billion in October. Personal saving as a percentage of disposable personal income was 5.3 percent in November, compared with 5.4 percent in October. For a comparison of personal saving in BEA’s national income and product accounts with personal saving in the Federal Reserve Board’s flow of funds accounts and data on changes in net worth, go to http://www.bea.gov/national/nipaweb/Nipa-Frb.asp.
Real DPI, real PCE and price index
Real DPI -- DPI adjusted to remove price changes -- increased 0.2 percent in November, the same increase as in October.
Real PCE -- PCE adjusted to remove price changes -- increased 0.3 percent in November, compared with an increase of 0.5 percent in October. Purchases of durable goods increased 0.2 percent, compared with an increase of 3.7 percent. Purchases of motor vehicles and parts turned down in November, after accounting for most of the increase in October. Purchases of nondurable goods increased 0.5 percent in November, compared with an increase of 0.3 percent in October. Purchases of services increased 0.3 percent, compared with an increase of 0.1 percent.
PCE price index -- The price index for PCE increased 0.1 percent in November, compared with an increase of 0.2 percent in October. The PCE price index, excluding food and energy, increased 0.1 percent, compared with an increase of less than 0.1 percent.
Revisions
Estimates have been revised for July through October. Changes in personal income, current-dollar and chained (2005) dollar DPI, and current-dollar and chained (2005) dollar PCE for September and October -- revised and as published in last month's release -- are shown below.
