Personal income decreased $3.21 trillion (13.1 percent) in April according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) decreased $3.22 trillion (14.6 percent) and personal consumption expenditures (PCE) increased $80.3 billion (0.5 percent).
Real DPI decreased 15.1 percent in April and Real PCE decreased 0.1 percent; goods decreased 1.3 percent and services increased 0.6 percent. The PCE price index increased 0.6 percent. Excluding food and energy, the PCE price index increased 0.7 percent.
The decrease in personal income in April primarily reflected a decrease in government social benefits. Within government social benefits, “other” social benefits decreased as economic impact payments made to individuals from the American Rescue Plan Act of 2021 continued, but at a lower level than in March. Unemployment insurance also decreased, led by decreases in payments from the Pandemic Unemployment Compensation program.
The $80.3 billion increase in current dollar PCE in April reflected an increase of $112.6 billion in spending for services that was partly offset by a $32.3 billion decrease in spending for goods. Within services, the largest contributors to the increase were spending for recreation services and for food services and accommodations. Within goods, a decrease in nondurable goods was partly offset by an increase in durable goods. Within nondurable goods, the decrease was widespread and led by food and beverages. Within durable goods, the increase was accounted for by an increase in motor vehicles and parts.
Personal outlays increased $82.8 billion in April. Personal saving was $2.81 trillion in April and the personal saving rate—personal saving as a percentage of disposable personal income—was 14.9 percent.
The PCE price index increased 3.6 percent in April from one year ago, reflecting increases in both goods and services. Energy prices increased 24.8 percent while food prices increased 0.9 percent. Excluding food and energy, the PCE price index increased 3.1 percent in April from one year ago.