For the month of April, the Commerce Department reported today that personal income was flat, inflation was down 0.3 percent due do a decline in gasoline prices, and that consumer spending was down 0.2 percent. Highlights from the report are as follows:
Personal income decreased $5.6 billion, or less than 0.1 percent, and disposable personal income (DPI) decreased $16.1 billion, or 0.1 percent, in April, according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE) decreased $20.5 billion, or 0.2 percent. In March, personal income increased $36.2 billion, or 0.3 percent, DPI increased $25.4 billion, or 0.2 percent, and PCE increased $14.2 billion, or 0.1 percent, based on revised estimates.
Real disposable income increased 0.1 percent in April, compared with an increase of 0.3 percent in March. Real PCE increased 0.1 percent, compared with an increase of 0.2 percent.
Wages and salaries
- Private wage and salary disbursements increased $1.6 billion in April, compared with an increase of $16.3 billion in March.
- Goods-producing industries’ payrolls decreased $2.0 billion, in contrast to an increase of $0.7 billion.
- Manufacturing payrolls decreased $2.1 billion, in contrast to an increase of $0.2 billion.
- Services-producing industries’ payrolls increased $3.7 billion, compared with an increase of $15.6 billion.
- Government wage and salary disbursements increased $0.2 billion, in contrast to a decrease of $0.4 billion.
Real DPI, real PCE and price index
- Real DPI — DPI adjusted to remove price changes — increased 0.1 percent in April, compared with an increase of 0.3 percent in March.
- Real PCE — PCE adjusted to remove price changes — increased 0.1 percent in April, compared with an increase of 0.2 percent in March.
- Purchases of durable goods increased 0.7 percent, in contrast to a decrease of less than 0.1 percent.
- Purchases of nondurable goods increased 0.1 percent, in contrast to a decrease of 0.2 percent.
- Purchases of services decreased 0.1 percent, in contrast to an increase of 0.4 percent.
The price index for PCE decreased 0.3 percent in April, compared with a decrease of 0.1 percent in March. The PCE price index, excluding food and energy, increased less than 0.1 percent, compared with an increase of 0.1 percent.
The bottom line is that (for those who are lucky enough to be working) wages are flat, inflation fell and consumers are still not spending (at least not in a robust manner) — not a good sign for an economy that relies heavily on consumer spending to drive its economy.
