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Personal Income and Outlays, March 2020

Summary:
Personal income decreased 2.1 billion (2.0 percent) in March according to estimates released today by the Bureau of Economic Analysis (tables 3 and 5). Disposable personal income (DPI) decreased 4.6 billion (2.0 percent) and personal consumption expenditures (PCE) decreased ,127.3 billion (7.5 percent). Real DPI decreased 1.7 percent in March and Real PCE decreased 7.3 percent (tables 5 and 7). The PCE price index decreased 0.3 percent. Excluding food and energy, the PCE price index decreased 0.1 percent (table 9). Coronavirus (COVID-19) Impact on March 2020 Personal Income and Outlays The decline in March personal income and outlays was, in part, due to the response to the spread of COVID-19, as governments issued “stay-at-home” orders. This led to rapid changes in demand, as

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Personal income decreased $382.1 billion (2.0 percent) in March according to estimates released today by the Bureau of Economic Analysis (tables 3 and 5). Disposable personal income (DPI) decreased $334.6 billion (2.0 percent) and personal consumption expenditures (PCE) decreased $1,127.3 billion (7.5 percent).

Real DPI decreased 1.7 percent in March and Real PCE decreased 7.3 percent (tables 5 and 7). The PCE price index decreased 0.3 percent. Excluding food and energy, the PCE price index decreased 0.1 percent (table 9).

Coronavirus (COVID-19) Impact on March 2020 Personal Income and Outlays

The decline in March personal income and outlays was, in part, due to the response to the spread of COVID-19, as governments issued “stay-at-home” orders. This led to rapid changes in demand, as businesses and schools switched to remote work or canceled operations, and consumers canceled, restricted, or redirected their spending. The full economic effects of the COVID-19 pandemic cannot be quantified in the Personal Income and Outlays estimate for March 2020 because the impacts are generally embedded in source data and cannot be separately identified. For more information, see the Advance first-quarter 2020 GDP Technical Note. For additional information on the monthly assumptions for personal consumption expenditures, see the Key Source Data Table.
  2019 2020
Nov. Dec. Jan. Feb. Mar.
Percent change from preceding month
Personal income:  
     Current dollars 0.5  0.2 0.5 0.6 -2.0
Disposable personal income:  
     Current dollars 0.4 0.2 0.5 0.5 -2.0
     Chained (2012) dollars 0.4 -0.1 0.4 0.4 -1.7
Personal consumption expenditures (PCE):  
     Current dollars 0.3 0.4 0.4 0.2 -7.5
     Chained (2012) dollars 0.2 0.1 0.3 0.1 -7.3
Price indexes:  
     PCE 0.1 0.3  0.2 0.1 -0.3
     PCE, excluding food and energy 0.1 0.2 0.2 0.2 -0.1
Price indexes: Percent change from month one year ago
     PCE 1.3 1.6 1.8 1.8 1.3
     PCE, excluding food and energy 1.5 1.6 1.7 1.8 1.7

The decrease in personal income in March primarily reflected a decrease in compensation (table 3). The estimate of private wages and salaries was primarily based on data from the Bureau of Labor Statistics monthly Current Employment Statistics report as well as unemployment insurance claims data from the Department of Labor’s Employment and Training Administration. For more information, see “How did BEA adjust March 2020 wages and salaries to account for the effects of COVID-19?”.

The decrease in real PCE in March reflected a decrease of $829.9 billion in spending for services and a $104.9 billion in spending for goods (table 7). Within services, the leading contributor to the decrease was spending on health care, including physician, dental, and paramedical services. Other contributors to the decrease in services were spending on food services and accommodations as well as recreation services. Within goods, the leading contributor to the decrease was spending on motor vehicles and parts. Partially offsetting the decreases in many categories of spending on goods was an increase in spending for food and beverages purchased for off-premises consumption. Detailed information on monthly real PCE spending can be found on Table 2.3.6U.

Personal outlays decreased $1.16 trillion in March (table 3). Personal saving was $2.17 trillion in March and the personal saving rate, personal saving as a percentage of disposable personal income, was 13.1 percent (table 1).

Upcoming Annual Update of the National Income and Product Accounts

BEA will release results from the 2020 annual update of the National Income and Product Accounts on July 30, 2020, in conjunction with the advance estimate of GDP for the second quarter of 2020. For more information, see the GDP Technical Note.

Updates to Personal Income and Outlays

Estimates have been updated for January and February. Revised and previously published changes from the preceding month for current-dollar personal income, and for current-dollar and chained (2012) dollar DPI and PCE, are shown below.

  Change from preceding month
January February
Previous Revised Previous Revised Previous Revised Previous Revised
(Billions of dollars) (Percent) (Billions of dollars) (Percent)
Personal income:  
     Current dollars 115.8 101.3 0.6 0.5 106.8 104.6 0.6 0.6
Disposable personal income:  
     Current dollars 98.8 88.6 0.6 0.5 88.7 87.9 0.5 0.5
     Chained (2012) dollars 68.1 56.5 0.5 0.4 66.6 66.5 0.4 0.4
Personal consumption expenditures:  
     Current dollars 34.0 66.5 0.2 0.4 27.7 26.8 0.2 0.2
     Chained (2012) dollars 11.9 39.2 0.1 0.3 13.0 12.8 0.1 0.1

Next release: May 29, 2020 at 8:30 A.M. EDT
Personal Income and Outlays: April 2020

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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