Economy Watch: Americans Earn More, Spend More in April
- May 31, 2017
Personal income in the United States increased $58.4 billion (up 0.4 percent) in April, following a 0.2 increase in March, according to the Bureau of Economic Analysis on Tuesday. Disposable personal income increased $56.5 billion (also up 0.4 percent). With those increases in income came more spending: personal consumption expenditures increased $53.2 billion for the month (again, up 0.4 percent).
Accounting for the still-modest rate of inflation, real disposable personal income increased 0.2 percent in April and real personal consumption expenditures increased 0.2 percent. That might be good news for retail sales, provided consumers don’t skew toward online sales any more than they already have.
The increase in personal income in April was mainly because of an increase in private wages and salaries, the BEA reported, which counts as good news for the wider economy, since wages have lagged productivity for so long. Also, the increase in real personal consumption expenditures for the month was more than accounted for by an increase in spending for both durable and nondurable goods, led by increases in recreational goods, and vehicles and gasoline.
By the BEA’s reckoning, personal income is the income received by, or on behalf of, all persons from all sources. It includes income from domestic sources as well as the rest of world, but doesn’t include realized or unrealized capital gains or losses.