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January 26, 2024US PERSONAL INCOME AND OUTLAY, DECEMBER AND ANNUAL 2023 Month over month (December 2023 vs November 2023, seasonally adjusted)
The US Bureau of Economic Analysis reported that US personal income increased by $60.0 billion (+0.26%) from November to December. Employee compensation was up $55.1 billion (+0.38%). Personal disposable income was up $51.8 billion (+0.25%) while personal consumption expenditures (PCE) grew by $133.9 billion (+0.71%).
US personal savings decreased by $82.9 billion (9.76%) in December.
US personal income is calculated as the sum of employee compensation ($14.57 trillion), proprietors' income ($1.89 trillion), rental income ($0.99trillion), receipts on assets ($3.69 trillion) and current transfers received ($4.07 trillion), less contributions to social insurance programs ($1.84 trillion). Personal income ($23.36 trillion) less personal current taxes ($2.78 trillion) equals disposable income ($20.58 trillion).
The outlay of US personal disposable income consists of personal consumption expenditures ($19.0 trillion), interest payments ($0.56 trillion) and current transfers paid ($0.25 trillion) with personal savings ($0.77 trillion) accounting for the remaining amount.
Trends
In December, US personal consumption expenditures growth was higher than growth in personal income.
Growth in the price index for personal consumption expenditures was down to +2.6% year-over-year in December. Year-over-year growth in the price index for all items excluding food and energy declined to 2.9%, but outpaced all items PCE inflation for the tenth consecutive month.
With growth in income outpacing consumption expenditures growth the US personal savings rate rdeclined to 3.7% of disposable personal income
Annual (2023 vs 2022)
In 2023, US personal income has increased by 5.2% with gains from all income sources led by growth in rental income (+10.1%). With an 12.4% decline in personal current taxes, annual growth in personal disposable income (+8.1%) has outpaced growth in total personal income.
US personal consumption expenditures increased by 6.0% in 2023, but this was outpaced by a 52.5% increase in interest payments as well as a 46.4% increase in personal savings.
In 2023, US personal income amounted to $275.6 trillion, consisting of $170.90 trillion in employee compensation, $22.19 trillion in proprietors' income, $11.60 trillion in rental income, $43.37 trillion in receipts on assets and $49.17 trillion in current transfer receipts, less $21.64 trillion in social insurance contributions. After paying $32.98 trillion in personal current taxes, US personal disposable income was $242.61 trillion.
US personal consumption expenditures of $222.77 trillion accounted for the largest part of personal outlays, followed by $5.97 trillion in interest payments, $2.94 trillion in current transfers paid and $10.94 trillion in personal savings.
US Bureau of Economic Analysis. Press release, December 2023; Data retrieved Federal Bank of St Louis, Table 2.6. Personal Income and Its Disposition, Monthly NIPA using a FRED API.
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