Home > News Release: Personal Income and Outlays, January 2010
EMBARGOED UNTIL RELEASE AT 8:30 A.M. EST, MONDAY, MARCH 1, 2010
BEA 10-06


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PERSONAL INCOME AND OUTLAYS: JANUARY 2010

Personal income increased $11.4 billion, or 0.1 percent, and disposable personal income (DPI)
decreased $47.6 billion, or 0.4 percent, in January, according to the Bureau of Economic Analysis.  The
decrease in DPI reflected an increase in federal nonwithheld income taxes.  Personal consumption
expenditures (PCE) increased $52.4 billion, or 0.5 percent.  In December, personal income increased
$41.2 billion, or 0.3 percent, DPI increased $40.3 billion, or 0.4 percent, and PCE increased $26.4 billion,
or 0.3 percent, based on revised estimates.

Real disposable income decreased 0.6 percent in January, in contrast to an increase of 0.2
percent in December.  Real PCE increased 0.3 percent, compared with an increase of 0.1 percent.

                                        2009                                                            2010
                                        Sept.           Oct.            Nov.            Dec.            Jan.
                                                       (Percent change from preceding month)
Personal income, current dollars        0.1             0.3             0.4             0.3             0.1
Disposable personal income:
 Current dollars                        0.2             0.4             0.5             0.4            -0.4
 Chained (2005) dollars                 0.1             0.2             0.3             0.2            -0.6
Personal consumption expenditures:
 Current dollars                       -0.6             0.5             0.5             0.3             0.5
 Chained (2005) dollars                -0.7             0.3             0.4             0.1             0.3

                                Wages and salaries

Private wage and salary disbursements increased $16.1 billion in January, compared with an increase of
$2.3 billion in December.  Goods-producing industries' payrolls increased $5.2 billion, in contrast
to a decrease of $3.2 billion; manufacturing payrolls increased $5.0 billion, in contrast to a
decrease of $1.5 billion.  Services-producing industries' payrolls increased $10.8 billion, compared
with an increase of $5.5 billion.

Government wage and salary disbursements increased $6.1 billion, compared with an increase
of $2.7 billion.  Pay raises for federal civilian and military personnel added $7.1 billion
to government payrolls in January.

                                Other personal income

Employer contributions for employee pension and insurance funds increased $3.2 billion in January,
compared with an increase of $1.3 billion in December.

Employer contributions for government social insurance increased $11.6 billion in January, and
were unchanged in December.  The January increase was boosted by $10.2 billion reflecting
an increase in the tax rates paid by employers to state unemployment insurance funds.
(Changes in employer contributions for government social insurance do not affect personal income,
because employer contributions for government social insurance are also included in total
contributions for government social insurance, which is a subtraction in the calculation of personal income.)

Proprietors' income decreased $3.2 billion in January, in contrast to an increase of $7.7 billion
in December.  Farm proprietors' income decreased $7.9 billion, in contrast to an increase of $5.9 billion.
Nonfarm proprietors' income increased $4.7 billion, compared with an increase of $1.8 billion.

Rental income of persons decreased $0.9 billion in January, in contrast to an increase
of $1.9 billion in December.  Personal income receipts on assets (personal interest income
plus personal dividend income) decreased $20.8 billion, in contrast to an increase of $11.0 billion.

Personal current transfer receipts increased $16.1 billion, compared with an increase of $14.5 billion.
The January change in personal current transfer receipts was reduced by retroactive social security
benefits payments, which had added $8.5 billion to December benefit payments; these benefits resulted
from a recalculation of the earnings base underlying the benefits for recent retirees.

Contributions for government social insurance -- a subtraction in calculating personal income -- increased
$16.7 billion in January, compared with an increase of $0.3 billion in December.  Employer contributions
were boosted by $10.2 billion in January by increases in unemployment-insurance rates.

                                Personal current taxes and disposable personal income

Personal current taxes increased $59.0 billion in January, compared with an increase of $0.9 billion
in December.  Federal net nonwithheld income taxes (payments of estimated taxes plus final settlement
less refunds) boosted the January change by $52.5 billion, based on federal budget  projections
of higher final settlements and lower refunds for 2010.

Disposable personal income (DPI) -- personal income less personal current taxes -- decreased
$47.6 billion, or 0.4 percent, in January, in contrast to an increase of $40.3 billion,
or 0.4 percent in December.

                                Personal outlays and personal saving

Personal outlays -- PCE, personal interest payments, and personal current transfer payments -- increased
$53.0 billion in January, compared with an increase of $21.6 billion in December. PCE increased
$52.4 billion, compared with an increase of $26.4 billion.

Personal saving -- DPI less personal outlays -- was $367.2 billion in January, compared with $467.9 billion in
December.  Personal saving as a percentage of disposable personal income was 3.3 percent in January, compared with
4.2 percent in December.  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
/national/nipaweb/Nipa-Frb.asp.

                                Real DPI, real PCE and price index

Real DPI -- DPI adjusted to remove price changes -- decreased 0.6 percent in January, in contrast to an increase
of 0.2 percent in December.

Real PCE -- PCE adjusted to remove price changes -- increased 0.3 percent in January, compared with an increase
of 0.1 percent in December.  Purchases of durable goods increased 0.7 percent, compared with an increase of
0.6 percent.  Purchases of nondurable goods increased 0.8 percent, in contrast to a decrease of 0.8 percent.
Purchases of services increased 0.1 percent, compared with an increase of 0.3 percent.

PCE price index -- The price index for PCE increased 0.2 percent in January, compared with an increase of 0.1
percent in December.  The PCE price index, excluding food and energy, increased less than 0.1 percent, compared with
an increase of 0.1 percent.

                                2009 Personal Income and Outlays

Personal income decreased 1.7 percent in 2009 (that is, from 2008 annual level to the 2009 annual level), in
contrast to an increase of 2.9 percent in 2008.  DPI increased 1.1 percent, compared with an increase of 3.9 percent.
The difference between the change in personal income and the change in DPI in 2009 reflected a sharp decrease in
personal current taxes in 2009.  Personal current taxes decreased 23.1 percent in 2009, compared with a decrease
of 3.9 percent in 2008.  PCE decreased 0.4 percent, in contrast to an increase of 3.1 percent.

Real DPI increased 0.9 percent in 2009, compared with an increase of 0.5 percent in 2008.  Real PCE decreased
0.6 percent, compared with a decrease of 0.2 percent.

                                Revisions

Estimates of personal income have been revised for July through December; estimates for PCE have been revised
for October through December.  Changes in personal income, current-dollar and chained (2005) dollar DPI, and
current-dollar and chained (2005) dollar PCE for November and December -- revised and as published in last
month's release -- are shown below.

For July through September, the revisions to wages and salaries reflected the incorporation of the most recently
available BLS tabulations of third-quarter wages and salaries from the quarterly census of employment and wages.
Wages and salaries were revised down for all three months.

                                                                Change from preceding month
                                        November                                  December
                                        Previous   Revised   Previous   Revised   Previous   Revised   Previous   Revised
                                       (Billions of dollars)      (Percent)      (Billions of dollars)      (Percent)
Personal Income:
 Current dollars                        61.1       51.6      0.5        0.4       44.5       41.2      0.4        0.3
Disposable personal income:
 Current Dollars                        60.7       50.6      0.5        0.5       45.9       40.3      0.4        0.4
 Chained (2005) dollars                 29.2       28.4      0.3        0.3       31.8       22.7      0.3        0.2
Personal consumption expenditures:
 Current dollars                        69.1       55.8      0.7        0.5       22.6       26.4      0.2        0.3
 Chained (2005) dollars                 38.8       34.4      0.4        0.4       11.5       11.1      0.1        0.1

This news release also presents revised estimates of wages and salaries, personal taxes, and contributions
for government social insurance for July through September 2009 (third quarter).  These estimates reflect
newly available third-quarter wage and salary tabulation from the quarterly census of employment and
wages from the Bureau of Labor Statistics.

Typically, social security, supplemental security income, and other benefit payments are boosted
by cost-of-living adjustments in January based on the increase in the Bureau of Labor Statistics’ Consumer
Price Index for Urban Wage Earners and Clerical Workers (CPI-W).  This year, there was no increase in the CPI-W.
As a result, these benefit payments were not adjusted for changes in the cost-of-living this January.

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 – March 29, 2010 at 8:30 A.M. EDT for Personal Income and Outlays for February.
                                    
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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 (2005) dollars.

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