Personal Income Increased 0.5 Percent in October

Personal income increased $93.4 billion (0.5%) in October according to estimates released today by the Bureau of Economic Analysis. Disposable personal income (DPI) increased $63.0 billion (0.3%) and personal consumption expenditures (PCE) increased $214.3 billion (1.3%).

Real DPI decreased 0.3% in October and Real PCE increased 0.7%; goods increased 1.0% and services increased 0.5%. The PCE price index increased 0.6%. Excluding food and energy, the PCE price index increased 0.4%.

2021
June  July  Aug. Sept. Oct.
Percent change from preceding month
Personal income:
     Current dollars 0.3 1.2 0.3 -1.0 0.5
Disposable personal income:
     Current dollars 0.1 1.3 0.3 -1.3 0.3
     Chained (2012) dollars -0.4 0.9 -0.1 -1.6 -0.3
Personal consumption expenditures (PCE):
     Current dollars 1.1 0.0 1.1 0.6 1.3
     Chained (2012) dollars 0.6 -0.4 0.7 0.3 0.7
Price indexes:
     PCE 0.5 0.4 0.4 0.4 0.6
     PCE, excluding food and energy 0.5 0.3 0.3 0.2 0.4
Price indexes: Percent change from month one year ago
     PCE 4.0 4.1 4.2 4.4 5.0
     PCE, excluding food and energy 3.6 3.6 3.6 3.7 4.1

The increase in personal income in October primarily reflected increases in compensation of employees and personal income receipts on assets that were partly offset by a decrease in government social benefits. Within compensation, the increase primarily reflected an increase in private wages and salaries. Within personal income receipts on assets, both dividend income and interest income increased. Within government social benefits, unemployment insurance decreased, reflecting decreases in payments from three pandemic-related unemployment programs: Pandemic Unemployment Compensation Payments, Pandemic Emergency Unemployment Compensation, and Pandemic Unemployment Assistance.

The $214.3 billion increase in current-dollar PCE in October reflected an increase of $123.8 billion in spending for goods and an increase of $90.5 billion in spending for services. Within goods, increases were widespread, led by motor vehicles and parts. Within services, increases were also widespread, led by “other” services (mainly international travel). Detailed information on monthly PCE spending can be found on Table 2.3.5U.

Personal outlays increased $216.8 billion in October. Personal saving was $1.32 trillion in October and the personal saving rate — personal saving as a percentage of disposable personal income — was 7.3%.

The PCE price index for October increased 5.0% from one year ago, reflecting increases in both goods and services. Energy prices increased 30.2% while food prices increased 4.8%. Excluding food and energy, the PCE price index for October increased 4.1% from one year ago.

Updates to Personal Income and Outlays

Estimates have been updated for April through September. For April through June, estimates for compensation, personal taxes, and contributions for government social insurance reflect the incorporation of updated second-quarter wage and salary data from the Bureau of Labor Statistics Quarterly Census of Employment and Wages program. Revised and previously published changes from the preceding month for current-dollar personal income, and for current-dollar and chained (2012) dollar DPI and PCE, are provided below for August and September.

Change from preceding month
August  September 
Previous Revised Previous Revised Previous Revised Previous Revised
(Billions of dollars) (Percent) (Billions of dollars) (Percent)
Personal income:
     Current dollars 41.3 69.0 0.2 0.3 -216.2 -203.7 -1.0 -1.0
Disposable personal income:
     Current dollars 26.4 50.2 0.1 0.3 -236.9 -232.4 -1.3 -1.3
     Chained (2012) dollars -30.1 -16.4 -0.2 -0.1 -252.8 -254.4 -1.6 -1.6
Personal consumption expenditures:
     Current dollars 155.1 171.1 1.0 1.1 93.4 100.6 0.6 0.6
     Chained (2012) dollars 87.3 95.5 0.6 0.7 36.4 38.0 0.3 0.3