Personal income decreased 1.1 percent while consumer spending increased 5.6 percent in June, according to estimates released today by the Bureau of Economic Analysis.
The decrease in personal income in June was more than accounted for by a decrease in government social benefits. “Other” social benefits decreased as payments to individuals from federal economic recovery programs continued, but at a lower level than in May. For more information, see “How are the economic impact payments for individuals authorized by the CARES Act of 2020 recorded in the NIPAs?”. Additional information on factors affecting monthly personal income can be found in “Effects of Selected Federal Pandemic Response Programs on Personal Income”.
Partially offsetting the decrease in other government social benefits were increases in compensation of employees and proprietors’ income as portions of the economy continued to reopen in June. Unemployment insurance benefits, based primarily on unemployment claims data from the Department of Labor’s Employment and Training Administration, also increased in June. For more information, see “How will federal government responses to the COVID-19 pandemic affect unemployment insurance benefits?”.
Consumer spending increased in June, reflecting increases in both goods and services.
- Within goods, the leading contributor to the increase was spending for clothing and footwear, based on Census Bureau Monthly Retail Trade Survey (MRTS) data.
- Within services, the leading contributors to the increase were spending for health care as well as food services and accommodations. Within health care, both hospital and outpatient services increased, based on volume data for hospital services and outpatient visits as well as credit card data. Spending for food services and accommodations was based on Census MRTS data and Smith Travel Research data.
For more information, read the full report.