Home > News Release: Personal Income and Outlays, May 2009
EMBARGOED UNTIL RELEASE AT 8:30 A.M. EDT, FRIDAY, JUNE 26, 2009
BEA 09-30


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PERSONAL INCOME AND OUTLAYS
May 2009
Personal income increased $167.1 billion, or 1.4 percent, and disposable personal income (DPI)
increased $178.1 billion, or 1.6 percent, in May, according to the Bureau of Economic Analysis.
Personal consumption expenditures (PCE) increased $25.1 billion, or 0.3 percent.  In April, personal
income increased $78.3 billion, or 0.7 percent, DPI increased $140.0 billion, or 1.3 percent, and PCE
increased $1.0 billion, or less than 0.1 percent, based on revised estimates.  The pattern of changes in
personal income and in DPI  reflect, in part, the pattern of increased government social benefit payments
associated with the  American Recovery and Reinvestment Act of 2009.

                                        2009
                                        Jan.            Feb.            Mar.            Apr.            May
                                                       (Percent change from preceding month)
Personal income, current dollars        0.0            -0.3            -0.3             0.7             1.4
Disposable personal income:
 Current dollars                        1.5            -0.1             0.0             1.3             1.6
 Chained (2000) dollars                 1.2            -0.4             0.0             1.2             1.6
Personal consumption expenditures:
 Current dollars                        0.9             0.4            -0.3             0.0             0.3
 Chained (2000) dollars                 0.7             0.0            -0.2            -0.1             0.2

Real DPI increased 1.6 percent in May, compared with an increase of 1.2 percent in April.  Real PCE increased 0.2 percent,
in contrast to a decrease of 0.1 percent in April.

The May change in DPI was boosted as a result of provisions of the American Recovery and Reinvestment Act of 2009.
Provisions of the Act reduced personal current taxes and increased government social benefit payments.
Excluding these special factors, which are discussed more fully below, DPI increased $20.6 billion, or 0.2 percent,
in May, following an increase of $101.3 billion, or 0.9 percent, in April.

                                Wages and salaries

Private wage and salary disbursements decreased $12.4 billion in May, compared with a decrease of $0.7 billion in April.
Goods-producing industries' payrolls decreased $12.9 billion, compared with a decrease of $12.2 billion; manufacturing
payrolls decreased $9.8 billion, compared with a decrease of $4.9 billion.  Services-producing industries' payrolls
increased $0.5 billion, compared with an increase of $11.5 billion. Government wage and salary disbursements increased
$3.9 billion, compared with an increase of $5.7 billion.

                                Other personal income

Supplements to wages and salaries increased $3.3 billion in May, compared with an increase of $3.9 billion in April.

Proprietors' income increased $0.4 billion in May, compared with an increase of $3.1 billion in April.  Farm proprietors'
income increased $0.6 billion, compared with an increase of $2.7 billion.  Nonfarm proprietors' income decreased
$0.2 billion, in contrast to an increase of $0.5 billion.

Rental income of persons increased $5.2 billion in May, compared with an increase of $4.9 billion in April.
Personal income receipts on assets (personal interest income plus personal dividend income) increased $2.5 billion,
compared with an increase of $2.6 billion.

Personal current transfer receipts increased $162.6 billion in May, compared with an increase of $59.1 billion in April.
The American Recovery and Reinvestment Act of 2009 provides for one-time payments of $250 to eligible individuals
receiving social security, supplemental security income, veterans benefits, and railroad retirement benefits.
These benefits boosted the level of personal current transfer receipts by $157.6 billions at an annual rate in May.
These payments are classified in “other” personal current transfer receipts rather than in old-age, survivors,
disability, and health insurance benefits because they are not benefits paid from the social security trust fund.

Contributions for government social insurance -- a subtraction in calculating personal income -- decreased $1.5 billion
in May, in contrast to an increase of $0.2 billion in April.

                                Personal current taxes and disposable personal income

Personal current taxes decreased $11.1 billion in May, compared with a decrease of $61.6 billion in April.
The Making Work Pay Credit provision of the American Recovery and Reinvestment Act of 2009 reduced personal
current taxes by $49.8 billion at an annual rate in both May and April, and $11.2 billion in March.
The provision allows a refundable tax credit of up to $400 for working individuals and up to $800 for married
taxpayers filing joint returns.  (The credit is subject to income limitations.)

Disposable personal income (DPI) -- personal income less personal current taxes -- increased $178.1 billion,
or 1.6 percent, in May, compared with an increase of $140.0 billion, or 1.3 percent in April.

                                Personal outlays and personal saving

Personal outlays -- PCE, personal interest payments, and personal current transfer payments -- increased
$17.9 billion in May, in contrast to a decrease of $6.3 billion in April.  PCE increased $25.1 billion,
compared with an increase of $1.0 billion.

Personal saving -- DPI less personal outlays -- was $768.8 billion in May, compared with $608.5 billion in April.
Personal saving as a percentage of disposable personal income was 6.9 percent in May, compared with 5.6 percent in
April.  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 and real PCE

Real DPI -- DPI adjusted to remove price changes -- increased 1.6 percent in May, compared with an
increase of 1.2 percent in April.

Real PCE -- PCE adjusted to remove price changes -- increased 0.2 percent in May, in contrast to
a decrease of 0.1 percent in April.  Purchases of durable goods increased 0.9 percent, in contrast to a decrease
of 1.3 percent.  Purchases of motor vehicles and parts accounted for most of the increase in May
and most of the decrease in April.  Purchases of nondurable goods increased 0.4 percent in May,
in contrast to a decrease of 0.4 percent in April.  Purchases of services decreased less
than 0.1 percent, in contrast to an increase of 0.3 percent.

The PCE price index increased 0.1 percent in May, the same increase as in April.  The PCE price index,
excluding food and energy, increased 0.1 percent in May, compared with an increase of 0.3 percent in April.

                                Revisions

Estimates have been revised for January through April.  Changes in personal income, current-dollar and chained
(2000) dollar DPI, and current-dollar and chained (2000) dollar PCE for March and April -- revised and as
published in last month's release -- are shown below.

                                                                Change from preceding month
                                        March                                     April
                                        Previous   Revised   Previous   Revised   Previous   Revised   Previous   Revised
                                       (Billions of dollars)      (Percent)      (Billions of dollars)     (Percent)
Personal Income:
 Current dollars.....................  -25.9      -33.0     -0.2       -0.3       58.2       78.3      0.5        0.7
Disposable personal income:
 Current Dollars.....................   8.2        1.2       0.1        0.0       121.8      140.0     1.1        1.3
 Chained (2000) dollars..............   9.7        3.1       0.1        0.0       94.5       108.4     1.1        1.2
Personal consumption expenditures:
 Current dollars.....................  -33.0      -25.3     -0.3       -0.3      -5.4        1.0      -0.1        0.0
 Chained (2000) dollars..............  -24.4      -18.8     -0.3       -0.2      -9.9       -5.6      -0.1       -0.1

                                Comprehensive Revision of the National Income and Product Accounts

As part of the comprehensive (or benchmark) revision of the national income and product accounts (NIPAs),
revised estimates of personal income and outlays will be released along with preliminary estimates for
June 2009 on August 4, 2009.  More information on the comprehensive revision is available on BEA’s Web
site at www.bea.gov/national/an1.htm, including a link to the article in the March 2009 issue of the
Survey of Current Business that discussed the changes in definitions and presentations that will be implemented
in the revision and to an article in the May Survey that described changes in statistical methods.
The September Survey will contain an article that describes the results of the revision in detail.
The Web site also contains links to redesigned PCE table stubs, and other revised NIPA table stubs.

BEA’s national, international, regional, and industry estimates; the Survey of Current Business;
and BEA news releases are available without charge on BEA’s Web site at www.bea.gov.
By visiting the site, you can also subscribe to receive free e-mail summaries of BEA releases and announcements.

                                *          *          *
Next release – August 4, 2009 at 8:30 A.M. EDT for Personal Income and Outlays for June.

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NOTE. - - Monthly estimates are expressed at seasonally adjusted annual rates, unless otherwise specified.
Month-to-month dollar changes are differences between these published estimates.  Month-to-month percent
changes are calculated from unrounded data and are not annualized.  “Real” estimates are in chained (2000) dollars.

This news release is available on BEA’s Web site at www.bea.gov/newsreleases/rels.htm.