Personal income increased $225.7 billion, or 1.9%, and disposable personal income increased $600.3 billion, or 5.7%, in May, according to the Bureau of Economic Analysis. Personal consumption expenditures increased $77.4 billion, or 0.8%.
In April, personal income increased $33.5 billion, or 0.3%, DPI increased $39.8 billion, or 0.4%, and PCE increased $41.1 billion, or 0.4%, based on revised estimates.
Real disposable income increased 5.3% in May compared with an increase of 0.1% in April. Real PCE increased 0.4% compared with an increase of 0.2%.
The May and April changes in disposable personal income — personal income less personal current taxes — were boosted as a result of provisions of the Economic Stimulus Act of 2008. The federal government issued rebate payments of $48.1 billion in May — $577.1 billion at an annual rate — and $1.9 billion in April — $23.3 billion at an annual rate.
The payments reduced personal current taxes and increased government social benefit payments. As a result, disposable personal income increased substantially. Excluding these special factors, disposable personal income increased $46.4 billion or 0.4% in May, after increasing $16.6 billion, or 0.2%, in April.
Private wage and salary disbursements increased $15.9 billion in May, in contrast to a decrease of $9.6 billion in April. Goods-producing industries’ payrolls increased $1.7 billion, in contrast to a decrease of $6.8 billion. Manufacturing payrolls increased $1.1 billion, in contrast to a decrease of $2.7 billion. Services-producing industries’ payrolls increased $14.3 billion, in contrast to a decrease of $2.9 billion. Government wage and salary disbursements increased $3.7 billion, compared with an increase of $4.0 billion.
Supplements to wages and salaries increased $4.3 billion in May, the same increase as in April.
Proprietors’ income increased $6.4 billion in May compared with an increase of $4.3 billion in April. Farm proprietors’ income increased $3.0 billion, up from a $2.1 billion increase in April. Nonfarm proprietors’ income increased $3.4 billion compared with an increase of $2.2 billion the previous month.
Rental income of persons increased $10.0 billion, up from an increase of $9.8 billion in April.
