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Personal Income and Outlays, June 2018

Summary:
PERSONAL INCOME AND OUTLAYS, JUNE 2018Comprehensive Update: 1929 Through May 2018 Personal income increased .7 billion (0.4 percent) in June according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased .3 billion (0.4 percent) and personal consumption expenditures (PCE) increased .1 billion (0.4 percent). Real DPI increased 0.3 percent in June and Real PCE increased 0.3 percent. The PCE price index increased 0.1 percent. Excluding food and energy, the PCE price index increased 0.1 percent. 2018 Feb. Mar. Apr. May June

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PERSONAL INCOME AND OUTLAYS, JUNE 2018
Comprehensive Update: 1929 Through May 2018


	Personal income increased $71.7 billion (0.4 percent) in June according to estimates released
today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased $65.3 billion
(0.4 percent) and personal consumption expenditures (PCE) increased $57.1 billion (0.4 percent).

Real DPI increased 0.3 percent in June and Real PCE increased 0.3 percent. The PCE price index
increased 0.1 percent. Excluding food and energy, the PCE price index increased 0.1 percent.

                                                                2018
                                                Feb.     Mar.    Apr.     May     June
                                                 Percent change from preceding month
Personal income:
 Current dollars                                0.3      0.4     0.3      0.4      0.4
Disposable personal income:
 Current dollars                                0.3      0.4     0.3      0.4      0.4
 Chained (2012) dollars                         0.2      0.3     0.1      0.2      0.3
Personal consumption expenditures (PCE):
 Current dollars                               -0.1      0.6     0.6      0.5      0.4
 Chained (2012) dollars                        -0.3      0.6     0.4      0.3      0.3
Price indexes:
 PCE                                            0.1      0.1     0.2      0.2      0.1
 PCE, excluding food and energy                 0.2      0.2     0.1      0.2      0.1

Price indexes:                                  Percent change from month one year ago
 PCE                                            1.9      2.1     2.0      2.2      2.2
 PCE, excluding food and energy                 1.7      2.0     1.9      1.9      1.9


The increase in personal income in June primarily reflected increases in wages and salaries and personal
dividend income (table 3).

The $39.7 billion increase in real PCE in June primarily reflected an increase of $36.4 billion in spending
for services. The largest contributor to the increase was spending for food services and accommodations (table 7).
Spending for goods increased $1.3 billion. Detailed information on monthly real PCE spending can be found in
Table 2.3.6U.

Personal outlays increased $62.7 billion in June (table 3). Personal saving was $1,049.7 billion in June and
the personal saving rate, personal saving as a percentage of disposable personal income, was 6.8 percent (table 1).

BOX._________________________
                                Comprehensive Update of the National Income and Product Accounts

The estimates released today also reflect the results of the 15th comprehensive update of the National Income
and Product Accounts (NIPAs). The updated estimates reflect previously announced improvements, and include the
introduction of new not seasonally adjusted estimates for GDP, GDI and their major components. For more information,
see the Technical Note. Revised NIPA table stubs, initial results, and background materials are available on the
BEA Web site.
_____________________________

                                Comprehensive Update of the National Income and Product Accounts

Comprehensive updates of the National Income and Product Accounts (NIPAs), which are conducted about every five years,
are an important part of BEA’s regular process for improving and modernizing its accounts to keep pace with the
ever-changing U.S. economy. Updates incorporate newly available and more comprehensive source data, as well as improved
estimation methodologies. The timespan for this year's comprehensive update is 1929 through May 2018.

With the release of these updated statistics, most NIPA tables are available on BEA's Web site (www.bea.gov). A complete
schedule of the table release plan is also available on BEA’s Web site. An article describing the results will be
published in the September 2018 issue of BEA’s monthly journal, the Survey of Current Business.

                                Updates

Revisions to annual estimates of personal income and outlays for 2013 through 2017 are shown in table 12. Revised and
previously published monthly estimates of personal income, DPI, PCE, personal saving as a percentage of DPI, real DPI,
and real PCE are shown in table 13. Revised and previously published annual and quarterly estimates are shown in table 14.

Personal income was revised up $107.4 billion, or 0.8 percent in 2013; $173.6 billion, or 1.2 percent in 2014;
$166.6 billion, or 1.1 percent in 2015; $196.4 billion, or 1.2 percent in 2016; and $401.9 billion, or 2.4 percent in 2017.

* For 2013, the revision to personal income primarily reflected a $118.3 billion upward revision to nonfarm proprietors’ income.

* For 2014, the revision to personal income primarily reflected a $129.9 billion upward revision to nonfarm proprietors’ income
  and a $44.5 billion revision to personal interest income.

* For 2015, the revision to personal income primarily reflected a $100.4 billion upward revision to nonfarm proprietors’ income
  and a $70.8 billion revision to personal interest income.

* For 2016, the revision to personal income primarily reflected a $113.2 billion revision to personal dividend income and a
  $83.1 billion revision to nonfarm proprietors’ income.

* For 2017, the revision to personal income primarily reflected a $143.3 billion revision to personal dividend income, a
  $111.2 billion revision to nonfarm proprietors’ income, a $100.6 billion revision to wages and salaries, and a $45.9 billion
  revision to personal interest income.

Revisions to nonfarm proprietors’ income for 2007-2017 primarily reflect revisions to estimates of underreported income.
Estimates of underreported income for nonfarm proprietors are revised based on newly available Internal Revenue Service (IRS)
tax gap data, which is a component of the IRS’ National Research Program. These adjustments to IRS source data are
designed to correct for the effects of taxpayer underreporting. Table 7.14 shows the adjustment for misreporting on
income tax returns.

Revisions to personal dividend income in 2016 and 2017 primarily reflect the incorporation of newly available IRS Statistics
of Income data.

The personal saving rate was revised up 1.4 percentage points to 6.4 percent in 2013, up 1.6 percentage points to 7.3 percent
in 2014, up 1.5 percentage points to 7.6 percent in 2015, up 1.8 percentage points to 6.7 percent in 2016, and up 3.3 percentage
points to 6.7 percent in 2017.

From 2012 to 2017, the average annual rate of growth of real disposable personal income was revised up 0.4 percentage point
from 1.8 percent to 2.2 percent.

BOX._________________________
                                QCEW Included in the First Quarter of 2018

BEA’s data on wages and salaries for the first quarter of 2018 were based on expedited information from state employment offices
across the country. BEA acknowledges and appreciates the special efforts by the Bureau of Labor Statistics, with the assistance
of these state employment offices, in providing preliminary data from the Quarterly Census of Employment and Wages (QCEW) for
the first quarter.
_____________________________

                                Next release:  August 30, 2018 at 8:30 A.M. EDT
                                   Personal Income and Outlays:  July 2018

Additional Information


Resources

Additional Resources available at www.bea.gov:

* Stay informed about BEA developments by reading the BEA blog, signing up for BEA’s email subscription service,
  or following BEA on Twitter @BEA_News.
* Historical time series for these estimates can be accessed in BEA’s Interactive Data Application.
* Access BEA data by registering for BEA’s Data Application Programming Interface (API).
* For more on BEA’s statistics, see our monthly online journal, the Survey of Current Business.
* BEA's news release schedule
* NIPA Handbook:  Concepts and Methods of the U.S. National Income and Product Accounts


Definitions

Personal income is the income received by, or on behalf of, all persons from all sources:  from participation as
laborers in production, from owning a home or business, from the ownership of financial assets, and from government
and business in the form of transfers. It includes income from domestic sources as well as the rest of world. It does
not include realized or unrealized capital gains or losses.

Disposable personal income is the income available to persons for spending or saving. It is equal to personal income
less personal current taxes.

Personal consumption expenditures (PCE) is the value of the goods and services purchased by, or on the behalf of,
“persons” who reside in the United States.

Personal outlays is the sum of PCE, personal interest payments, and personal current transfer payments.

Personal saving is personal income less personal outlays and personal current taxes.

The personal saving rate is personal saving as a percentage of disposable personal income.

Current-dollar estimates are valued in the prices of the period when the transactions occurred—that is, at “market
value.” Also referred to as “nominal estimates” or as “current-price estimates.”

Real values are inflation-adjusted estimates—that is, estimates that exclude the effects of price changes.

For more definitions, see the Glossary: National Income and Product Accounts.


Statistical conventions

Annual rates. Monthly and quarterly values are expressed at seasonally-adjusted annual rates (SAAR). Dollar changes
are calculated as the difference between these SAAR values. For detail, see the FAQ “Why does BEA publish estimates
at annual rates?”

Month-to-month percent changes are calculated from unrounded data and are not annualized.

Quarter-to-quarter percent changes are calculated from unrounded data and are displayed at annual rates. For detail,
see the FAQ “How is average annual growth calculated?”

Quantities and prices. Quantities, or “real” volume measures, and prices are expressed as index numbers with a specified
reference year equal to 100 (currently 2012). Quantity and price indexes are calculated using a Fisher-chained weighted
formula that incorporates weights from two adjacent periods (months for monthly data, quarters for quarterly data and
annuals for annual data). For details on the calculation of quantity and price indexes, see Chapter 4: Estimating Methods
in the NIPA Handbook.

Chained-dollar values are calculated by multiplying the quantity index by the current dollar value in the reference
year (2012) and then dividing by 100. Percent changes calculated from real quantity indexes and chained-dollar levels
are conceptually the same; any differences are due to rounding. Chained-dollar values are not additive because the
relative weights for a given period differ from those of the reference year. In tables that display chained-dollar
values, a "residual" line shows the difference between the sum of detailed chained-dollar series and its corresponding
aggregate.
Bureau of Economic Analysis
The BEA Advisory Committee advises the Director of BEA on matters related to the development and improvement of BEA’s national, regional, industry, and international economic accounts, especially in areas of new and rapidly growing economic activities arising from innovative and advancing technologies, and provides recommendations from the perspectives of the economics profession, business, and government.

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