Personal income rose by 10 percent ($1,954.7 billion) in January, according to estimates released on Friday by the Bureau of Economic Analysis. It also released these other key economic figures:
- Disposable personal income increased by $1,963.2 billion (11.4 percent).
- Personal consumption expenditures (PCE) increased by $340.9 billion (2.4 percent).
- Real DPI increased 11 percent and real PCE increased 2.0 percent.
- Goods increased 5.1 percent and services increased 0.5 percent.
- The PCE price index also increased 0.3 percent.
“The estimate for January personal income and outlays was impacted by the continued federal response to the spread of COVID-19,” the report said, citing payments and unemployment insurance benefits distributed under the Coronavirus Response and Relief Supplemental Appropriations Act, which was enacted on Dec. 27, 2020.
“The full economic effects of the COVID-19 pandemic cannot be quantified in the personal income and outlays estimate, because the impacts are generally embedded in source data and cannot be separately identified.”
The increase in personal income in January was more than accounted for by an increase in government social benefits to persons as payments were made to individuals from federal COVID-19 pandemic response programs.
The increase in “other” benefits primarily reflected economic impact payments distributed through the CRRSA Act. Unemployment insurance also increased, reflecting an increase in pandemic unemployment compensation, including supplemental weekly payments to unemployment beneficiaries reintroduced by the CRRSA Act.
The $340.9 billion increase in current dollar PCE in January reflected an increase of $277.2 billion in spending for goods and a $63.7 billion increase in spending for services.
Within goods, the increases were widespread across all categories, led by recreational goods and vehicles (notably, information processing equipment) as well as food and beverages.
Within services, the increase was led by spending for food services and accommodations (more than accounted for by food services). Spending for health care (led by outpatient services) also increased, reflecting data on the volume of visits as well as revenue data.
Partly offsetting these increases was a decrease in housing and utilities (led by electricity and gas).
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