Thursday , November 26 2020
Home / Calculated Risk / Real Personal Income less Transfer Payments

Real Personal Income less Transfer Payments

Summary:
Government transfer payments were mostly unchanged in September compared to August, but were still almost trillion (on SAAR basis) above the February level.  Most of the increase in transfer payments - compared to the level prior to the crisis - is from unemployment insurance and "other" (CARES ACT).  There was a sharp decline in unemployment insurance in both August and September.This table shows the amount of unemployment insurance and "Other" transfer payments since February 2020 (pre-crisis level).  The increase in "Other" was mostly due to other parts of the CARES Act such as the ,200 one time payment.Selected Transfer PaymentsBillions of dollars, SAAR OtherUnemploymentInsuranceFeb6Mar5Apr,3793May,360,356Jun8,405Jul1,318Aug61Sep45A key

Topics:
Calculated Risk considers the following as important:

This could be interesting, too:

Dean Baker writes Why are the Free Traders All Protectionists? Vaccines and Sharing Knowledge (Fun for Thanksgiving)

Doug Short writes Real Disposable Income Per Capita in October

Doug Short writes The Big Four: Real Personal Income in October

Doug Short writes Michigan Consumer Sentiment: November Final Mostly Unchanged

Government transfer payments were mostly unchanged in September compared to August, but were still almost $1 trillion (on SAAR basis) above the February level.  Most of the increase in transfer payments - compared to the level prior to the crisis - is from unemployment insurance and "other" (CARES ACT). 

There was a sharp decline in unemployment insurance in both August and September.

This table shows the amount of unemployment insurance and "Other" transfer payments since February 2020 (pre-crisis level).  The increase in "Other" was mostly due to other parts of the CARES Act such as the $1,200 one time payment.

Selected Transfer Payments
Billions of dollars, SAAR
OtherUnemployment
Insurance
Feb$506$28
Mar$515$74
Apr$3,379$493
May$1,360$1,356
Jun$758$1,405
Jul$771$1,318
Aug$716$631
Sep$964$365

A key measure of the health of the economy (Used by NBER in recession dating) is Real Personal Income less Transfer payments.

Real Personal Income less Transfer Payments Click on graph for larger image.

This graph shows real personal income less transfer payments since 1990.

This measure of economic activity increased 0.7% in September, compared to August, and was down 2.2% compared to February 2020 (previous peak).

Real Personal Income less Transfer PaymentsAnother way to look at this data is as a percent of the previous peak.

Real personal income less transfer payments was off 8.3% in April. This was a larger decline than the worst of the great recession.

Currently personal income less transfer payments are still off 2.2% (dashed line).

Leave a Reply

Your email address will not be published. Required fields are marked *