News Release

FOR WIRE TRANSMISSION: 8:30 A.M. EST, THURSDAY, MARCH 1, 2001
BEA 01-05

Personal Income and Outlays, January 2001




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James E. Rankin: (202) 606-5301 (Personal Income) BEA 01-05 Greg Key: 606-5302 (Personal Outlays) Recorded message: 606-5303 
              PERSONAL INCOME AND OUTLAYS:  JANUARY 2001
 Personal income increased $48.8 billion, or 0.6 percent, and disposable personal income (DPI)
increased $34.2 billion, or 0.5 percent, in January, according to the Bureau of Economic Analysis.
Personal consumption expenditures (PCE) increased $46.9 billion, or 0.7 percent.  In December,
personal income increased $35.4 billion, or 0.4 percent, DPI increased $28.1 billion, or 0.4 percent, and
PCE increased $26.4 billion, or 0.4 percent, based on revised estimates.
                                                                2000                                 2001
                                             Sept.        Oct.        Nov.            Dec.           Jan.
                                                        (Percent change from preceding month)
Personal income, current dollars              1.1        -0.2          0.2             0.4           0.6
Disposable personal income:
  Current dollars                             1.2        - .4           .1              .4            .5
  Chained (1996) dollars                       .8        - .5         - .1              .2            .0
Personal consumption expenditures:
  Current dollars                              .8          .2           .3              .4            .7
  Chained (1996) dollars                       .5          .1           .1              .2            .2
 The January change in personal income was affected by several special factors.  The
January change was boosted by cost-of-living adjustments to several federal transfer payment
programs and by pay raises for federal civilian and military personnel.  The January change was
reduced by program changes affecting personal contributions for social insurance, by federal
agricultural subsidy payments, and by lump-sum social security benefit payments that had
boosted December personal income.  Excluding these special factors, personal income increased
$40.6 billion, or 0.5 percent, in January, after increasing $25.8 billion, or 0.3 percent, in
December.  These special factors are discussed more fully below.
Wages and salaries
 Private wage and salary disbursements increased $25.9 billion in January, compared with  an
increase of $6.9 billion in December.  Goods-producing industries' payrolls increased $11.9 billion,
in contrast to a decrease of $8.6 billion; manufacturing payrolls increased $2.5 billion, in contrast to
a decrease of $7.6 billion.  Distributive industries' payrolls increased $4.4 billion, compared with an
increase of $5.5 billion.  Service industries' payrolls increased $9.5 billion, compared with an
increase of $10.0 billion.
 Government wage and salary disbursements increased $9.4 billion in January, compared with
an increase of $1.2 billion in December.  Pay raises for federal civilian and military personnel added
$5.5 billion to government payrolls in January.
Other personal income
 Proprietors' income decreased $2.4 billion in January, in contrast to an increase of $7.4 billion
in December.  Farm proprietors' income decreased $6.1 billion, in contrast to an increase of $6.1
billion.  The changes in farm proprietors' income reflected the pattern of specially authorized federal
farm subsidy payments, which were $0.8 billion (at an annual rate) in January, $5.5 billion in
December, and $0.3 billion in November.  Nonfarm proprietors' income increased $3.7 billion in
January, compared with an increase of $1.3 billion in December.
 Transfer payments increased $18.0 billion in January, compared with an increase of $11.7
billion in December.  The changes in transfer payments reflected 3.5-percent cost-of-living
adjustments to social security benefits and several other federal transfer payment programs, which
added $16.3 billion to the January change in transfer payments.  The January change in transfer
payments was reduced by lump-sum social security benefits payments, which had added $3.3 billion
to December transfer payments; these benefit payments resulted from a recalculation of the earnings
base underlying the benefits for recent retirees.
 Personal interest income increased $1.4 billion in January, compared with an increase of $1.5
billion in December.  Personal dividend income increased $2.2 billion, compared with an increase of
$2.7 billion.  Rental income of persons decreased $0.9 billion, in contrast to an increase of $2.5
billion.  The changes in rental income of persons reflected, in part, the pattern of specially
authorized federal agricultural subsidy payments to owners of leased farm land, which were $0.2
billion in January, $1.2 billion in December, and $0.1 billion in November.
  Personal contributions for social insurance -- a subtraction in calculating personal income --
increased $6.5 billion in January, compared with an increase of $0.6 billion in December.  The
January increase reflected the effect of an increase in the social security taxable wage base for
employees and the self-employed (from $76,200 to $80,400), which added $2.6 billion to January
personal contributions for social insurance.  The January increase also reflected the effect of an
increase in the monthly premium paid by participants in the supplementary medical insurance
program (Medicare B), which added $2.0 billion to January personal contributions.
Personal taxes and disposable personal income
 Personal tax and nontax payments increased $14.6 billion in January, compared with an
increase of $7.3 billion in December.  Indexation provisions of current tax law reduced federal
income tax payments by $4.4 billion in January.
 Disposable personal income (DPI) -- personal income less personal tax and nontax payments --
increased $34.2 billion, or 0.5 percent, in January, compared with an increase of $28.1 billion, or 0.4
percent, in December.
Personal outlays and personal saving
 Personal outlays -- PCE, interest paid by persons, and personal transfer payments to the rest of
the world (net) -- increased $47.9 billion in January, compared with an increase of $26.7 billion in
December.  PCE increased $46.9 billion, compared with an increase of $26.4 billion.
 Personal saving -- DPI less personal outlays -- was a negative $72.3 billion in January,
compared with a negative $58.7 billion in December.  Saving from current income may be near zero
or negative when outlays are financed by borrowing (including borrowing financed through credit
cards or home equity loans), by selling investments or other assets, or by using savings from
previous periods.  Personal saving as a percentage of disposable personal income was a negative 1.0
percent in January, compared with a negative 0.8 percent in December.
Real DPI and real PCE
 Real DPI -- DPI adjusted to remove price changes -- increased less than 0.1 percent in January,
        compared with an increase of 0.2 percent in December.
 Real PCE -- PCE adjusted to remove price changes -- increased 0.2 percent in January, the
same increase as in December.  Purchases of durable goods increased 1.8 percent in January, in
contrast to a decrease of 1.0 percent in December.  Purchases of motor vehicles and parts accounted
for most of the January increase and most of the December decrease.  Purchases of nondurable
goods increased 0.3 percent in January, compared with an increase of 0.2 percent in December.
Purchases of services decreased 0.2 percent, in contrast to an increase of 0.4 percent.
Revisions
 Estimates have been revised for October through December.  Changes in personal income,
current-dollar and chained (1996) dollar DPI, and current-dollar and chained (1996) dollar PCE for
November and December -- revised and as published in last month's release -- are shown below.
Revisions for October were small.

                                                     Change from preceding month
                                          November                                December
                            Previous  Revised    Previous  Revised    Previous  Revised   Previous  Revised
                                (Dollars)            (Percent)            (Dollars)          (Percent)
Personal Income:
  Current dollars..          17.8      14.4         0.2      0.2        36.6     35.4       0.4       0.4
Disposable personal income:
  Current dollars..           8.4       5.7          .1       .1        28.8     28.1        .4        .4
  Chained (1996) dollars..   -6.0      -7.9         -.1      -.1        14.9     14.2        .2        .2
Personal consumption expenditures:
  Current dollars..          21.9      19.5          .3       .3        19.4     26.4        .3        .4
  Chained (1996) dollars..    6.7       5.2          .1       .1         6.6     12.9        .1        .2
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     (202)  606-5306   Gross domestic product
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                        *          *          *
Next release -- Personal Income and Outlays for February will be released on
                      March 30, at 8:30 A.M. EST.

                                                  Table 1.-Personal Income
                             [Billions of dollars; months seasonally adjusted at annual rates]
----------------------------------------------------------------------------------------------------------------------------
                                           1999    2000/r/    Aug 00     Sep 00   Oct 00/r/  Nov 00/r/  Dec 00/r/  Jan 01/p/
----------------------------------------------------------------------------------------------------------------------------
Personal income.....................    7,789.6    8,281.0    8,326.5    8,420.6    8,405.7    8,420.1    8,455.5    8,504.3
  Wage and salary disbursements.....    4,470.0    4,769.1    4,797.8    4,827.8    4,858.9    4,872.9    4,881.0    4,916.3
    Private industries..............    3,745.6    4,008.3    4,032.5    4,060.8    4,091.3    4,105.5    4,112.4    4,138.3
      Goods-producing industries....    1,089.2    1,153.1    1,158.8    1,163.2    1,173.4    1,177.0    1,168.4    1,180.3
        Manufacturing...............      782.4      815.9      819.7      820.3      827.8      829.3      821.7      824.2
      Distributive industries.......    1,020.3    1,107.1    1,113.2    1,129.0    1,136.5    1,144.5    1,150.0    1,154.4
      Service industries............    1,636.0    1,748.1    1,760.5    1,768.6    1,781.4    1,784.0    1,794.0    1,803.5
    Government......................      724.4      760.8      765.3      767.0      767.7      767.4      768.6      778.0
  Other labor income................      501.0      524.0      527.6      530.0      532.0      533.9      535.9      537.8
  Proprietors' income with
   inventory valuation and capital
   consumption adjustments..........      663.5      710.5      712.3      756.0      712.3      710.8      718.2      715.8
    Farm............................       25.3       22.6       14.7       62.9       16.9       15.4       21.5       15.4
    Nonfarm.........................      638.2      688.0      697.7      693.1      695.4      695.4      696.7      700.4
  Rental income of persons with
   capital consumption adjustment...      143.4      140.1      134.5      144.0      134.8      135.3      137.8      136.9
  Personal dividend income..........      370.3      396.6      399.6      402.2      404.7      407.1      409.8      412.0
  Personal interest income..........      963.7    1,033.7    1,042.4    1,046.1    1,047.9    1,049.1    1,050.6    1,052.0
  Transfer payments to persons......    1,016.2    1,067.7    1,074.9    1,079.1    1,082.0    1,078.6    1,090.3    1,108.3
    Old-age, survivors, disability,
     and health insurance benefits..      588.0      622.4      627.2      630.9      629.1      626.7      635.2      649.3
    Government unemployment
     insurance benefits.............       20.3       20.0       20.0       20.1       20.5       20.7       20.8       21.1
      Other.........................      407.9      425.2      427.8      428.1      432.3      431.2      434.2      437.8
  Less: Personal contributions for
   social insurance.................      338.5      360.7      362.6      364.6      366.7      367.6      368.2      374.7
----------------------------------------------------------------------------------------------------------------------------
p Preliminary.
r Revised.
Source: U.S. Department of Commerce, Bureau of Economic Analysis.
                                        Table 2.-The Disposition of Personal Income
                                                   [Billions of dollars]
----------------------------------------------------------------------------------------------------------------------------
                                           1999     2000/r/   Aug 00     Sep 00    Oct 00/r/  Nov 00/r/  Dec 00/r/  Jan 01/p/
----------------------------------------------------------------------------------------------------------------------------
Personal income.....................    7,789.6    8,281.0    8,326.5    8,420.6    8,405.7    8,420.1    8,455.5    8,504.3
Less: Personal tax and nontax
 payments...........................    1,152.0    1,291.8    1,308.7    1,322.0    1,334.2    1,342.9    1,350.2    1,364.8
Equals: Disposable personal income..    6,637.7    6,989.3    7,017.8    7,098.6    7,071.5    7,077.2    7,105.3    7,139.5
Less: Personal outlays..............    6,490.1    6,998.4    7,045.5    7,101.3    7,115.7    7,137.2    7,163.9    7,211.8
  Personal consumption expenditures.    6,268.7    6,757.3    6,801.2    6,856.2    6,868.6    6,888.1    6,914.5    6,961.4
  Interest paid by persons..........      194.8      212.0      214.8      215.6      217.3      219.3      219.8      220.7
  Personal transfer payments to the
   rest of the world (net)..........       26.6       29.0       29.5       29.5       29.7       29.7       29.7       29.7
Equals: Personal saving.............      147.6       -9.1      -27.7       -2.7      -44.2      -60.0      -58.7      -72.3
Addenda:
  Disposable personal income:
    Chained (1996) dollars\1\.......    6,331.0    6,510.6    6,531.9    6,585.9    6,553.9    6,546.0    6,560.2    6,560.4
    Per capita:
      Current dollars...............     24,314     25,376     25,451     25,722     25,604     25,606     25,689     25,793
      Chained (1996) dollars........     23,191     23,638     23,689     23,864     23,730     23,684     23,719     23,701
    Population (thousands)..........    272,996    275,423    275,738    275,970    276,191    276,389    276,585    276,798
  Personal saving as a percentage
   of disposable personal income....        2.2        -.1        -.4         .0        -.6        -.8        -.8       -1.0
----------------------------------------------------------------------------------------------------------------------------
p Preliminary.
r Revised.
1. Disposable personal income in chained (1996) dollars equals the
current-dollar figure divided by the implicit price deflator for
personal consumption expenditures.
Source: U.S. Department of Commerce, Bureau of Economic Analysis.
                          Table 3.-Personal Income and Its Disposition, Change from Preceding Period
                                                        [Billions of dollars]
----------------------------------------------------------------------------------------------------------------------------
                                           1999      2000/r/   Aug 00     Sep 00   Oct 00/r/  Nov 00/r/  Dec 00/r/  Jan 01/p/
----------------------------------------------------------------------------------------------------------------------------
Personal income.....................      398.6      491.4       26.5       94.1      -14.9       14.4       35.4       48.8
  Wage and salary disbursements.....      279.3      299.1        8.7       30.0       31.1       14.0        8.1       35.3
    Private industries..............      247.6      262.7        7.2       28.3       30.5       14.2        6.9       25.9
      Goods-producing industries....       50.6       63.9       -3.4        4.4       10.2        3.6       -8.6       11.9
        Manufacturing...............       25.8       33.5       -4.3         .6        7.5        1.5       -7.6        2.5
      Distributive industries.......       71.2       86.8        1.1       15.8        7.5        8.0        5.5        4.4
      Service industries............      125.7      112.1        9.5        8.1       12.8        2.6       10.0        9.5
    Government......................       31.7       36.4        1.5        1.7         .7        -.3        1.2        9.4
  Other labor income................       15.5       23.0        2.5        2.4        2.0        1.9        2.0        1.9
  Proprietors' income with
   inventory valuation and capital
   consumption adjustments..........       42.8       47.0        6.3       43.7      -43.7       -1.5        7.4       -2.4
    Farm............................        -.1       -2.7       -2.8       48.2      -46.0       -1.5        6.1       -6.1
    Nonfarm.........................       43.0       49.8        9.2       -4.6        2.3         .0        1.3        3.7
  Rental income of persons with
   capital consumption adjustment...        8.0       -3.3       -1.5        9.5       -9.2         .5        2.5        -.9
  Personal dividend income..........       19.2       26.3        2.4        2.6        2.5        2.4        2.7        2.2
  Personal interest income..........       22.9       70.0        2.4        3.7        1.8        1.2        1.5        1.4
  Transfer payments to persons......       33.2       51.5        6.2        4.2        2.9       -3.4       11.7       18.0
    Old-age, survivors, disability,
     and health insurance benefits..       10.0       34.4        3.7        3.7       -1.8       -2.4        8.5       14.1
    Government unemployment
     insurance benefits.............         .8        -.3         .2         .1         .4         .2         .1         .3
     Other..........................       22.5       17.3        2.4         .3        4.2       -1.1        3.0        3.6
  Less: Personal contributions for
   social insurance.................       22.3       22.2         .5        2.0        2.1         .9         .6        6.5
Less: Personal tax and nontax
 payments...........................       81.1      139.8       15.1       13.3       12.2        8.7        7.3       14.6
Equals: Disposable personal income..      317.7      351.6       11.4       80.8      -27.1        5.7       28.1       34.2
Less: Personal outlays..............      435.4      508.3       28.2       55.8       14.4       21.5       26.7       47.9
  Personal consumption expenditures.      417.8      488.6       26.0       55.0       12.4       19.5       26.4       46.9
  Interest paid by persons..........       15.0       17.2        2.1         .8        1.7        2.0         .5         .9
  Personal transfer payments to the
   rest of the world (net)..........        2.6        2.4         .0         .0         .2         .0         .0         .0
Equals: Personal saving.............     -117.8     -156.7      -16.8       25.0      -41.5      -15.8        1.3      -13.6
Addendum:
  Disposable personal income:
   chained (1996) dollars\1\........      196.9      179.6       18.7       54.0      -32.0       -7.9       14.2         .2
----------------------------------------------------------------------------------------------------------------------------
p Preliminary.
r Revised.
Source: U.S. Department of Commerce, Bureau of Economic Analysis.
                             Table 4-Personal Consumption Expenditures by Major Type of Product
                             [Billions of dollars; months seasonally adjusted at annual rates]
----------------------------------------------------------------------------------------------------------------------------
                                           1999     2000/r/   Aug 00     Sep 00    Oct 00/r/  Nov 00/r/   Dec 00/r/  Jan 01/p/
----------------------------------------------------------------------------------------------------------------------------
                                    ----------------------------------------------------------------------------------------
                                                                  Billions of current dollars
                                    ----------------------------------------------------------------------------------------
Personal consumption expenditures...    6,268.7    6,757.3    6,801.2    6,856.2    6,868.6    6,888.1    6,914.5    6,961.4
  Durable goods.....................      761.3      820.5      821.1      835.8      825.8      816.0      807.7      823.5
  Nondurable goods..................    1,845.5    2,009.7    2,025.7    2,044.8    2,047.3    2,044.4    2,045.7    2,057.7
  Services..........................    3,661.9    3,927.2    3,954.3    3,975.6    3,995.5    4,027.8    4,061.0    4,080.1
                                    ----------------------------------------------------------------------------------------
                                                               Billions of chained (1996) dollars
                                    ----------------------------------------------------------------------------------------
Personal consumption expenditures...    5,978.8    6,294.4    6,330.3    6,360.9    6,365.9    6,371.1    6,384.0    6,396.7
  Durable goods.....................      817.8      896.2      900.2      916.5      907.1      896.1      886.9      902.8
  Nondurable goods..................    1,779.4    1,868.7    1,885.4    1,885.4    1,888.2    1,883.6    1,887.4    1,893.6
  Services..........................    3,390.8    3,544.1    3,559.4    3,575.8    3,585.5    3,604.0    3,620.3    3,613.7
                                    ----------------------------------------------------------------------------------------
                                                              Chain-type price indexes (1996=100)
                                    ----------------------------------------------------------------------------------------
Personal consumption expenditures...     104.85     107.38     107.45     107.80     107.91     108.13     108.32     108.84
  Durable goods.....................      93.09      91.56      91.20      91.18      91.02      91.05      91.05      91.20
  Nondurable goods..................     103.71     107.55     107.46     108.48     108.44     108.55     108.40     108.69
  Services..........................     107.99     110.84     111.10     111.19     111.44     111.77     112.19     112.92
Addendum:
  Personal consumption expenditures
     less food and energy...........     105.11     106.82     106.87     107.03     107.12     107.36     107.53     107.87
                                    ----------------------------------------------------------------------------------------
                                                                  Change from preceding period
                                    ----------------------------------------------------------------------------------------
                                    ----------------------------------------------------------------------------------------
                                                                  Billions of current dollars
                                    ----------------------------------------------------------------------------------------
Personal consumption expenditures...      417.8      488.6       26.0       55.0       12.4       19.5       26.4       46.9
  Durable goods.....................       67.4       59.2        3.8       14.7      -10.0       -9.8       -8.3       15.8
  Nondurable goods..................      137.9      164.2        1.8       19.1        2.5       -2.9        1.3       12.0
  Services..........................      212.6      265.3       20.3       21.3       19.9       32.3       33.2       19.1
                                    ----------------------------------------------------------------------------------------
                                                               Billions of chained (1996) dollars
                                    ----------------------------------------------------------------------------------------
Personal consumption expenditures...      300.1      315.6       32.0       30.6        5.0        5.2       12.9       12.7
  Durable goods.....................       90.5       78.4        7.4       16.3       -9.4      -11.0       -9.2       15.9
  Nondurable goods..................       94.6       89.3        8.4         .0        2.8       -4.6        3.8        6.2
  Services..........................      121.4      153.3       16.7       16.4        9.7       18.5       16.3       -6.6
----------------------------------------------------------------------------------------------------------------------------
p Preliminary.
r Revised.
Source: U.S. Department of Commerce, Bureau of Economic Analysis.
                              Table 5.-Percent Change From Preceding Period in Selected Series
----------------------------------------------------------------------------------------------------------------------------
                                           1999      2000/r/     Aug 00     Sep 00  Oct 00/r/ Nov 00/r/  Dec 00/r/  Jan 01/p/
----------------------------------------------------------------------------------------------------------------------------
                                    ----------------------------------------------------------------------------------------
                                                                    Based on current dollars
                                    ----------------------------------------------------------------------------------------
Personal income.....................        5.4        6.3         .3        1.1        -.2         .2         .4         .6
Disposable personal income..........        5.0        5.3         .2        1.2        -.4         .1         .4         .5
Personal consumption expenditures...        7.1        7.8         .4         .8         .2         .3         .4         .7
  Durable goods.....................        9.7        7.8         .5        1.8       -1.2       -1.2       -1.0        1.9
  Nondurable goods..................        8.1        8.9         .1         .9         .1        -.1         .1         .6
  Services..........................        6.2        7.2         .5         .5         .5         .8         .8         .5
                                    ----------------------------------------------------------------------------------------
                                                                Based on chained (1996) dollars
                                    ----------------------------------------------------------------------------------------
Disposable personal income..........        3.2        2.8         .3         .8        -.5        -.1         .2         .0
Personal consumption expenditures...        5.3        5.3         .5         .5         .1         .1         .2         .2
  Durable goods.....................       12.4        9.6         .8        1.8       -1.0       -1.2       -1.0        1.8
  Nondurable goods..................        5.6        5.0         .5         .0         .2        -.2         .2         .3
  Services..........................        3.7        4.5         .5         .5         .3         .5         .4        -.2
----------------------------------------------------------------------------------------------------------------------------
p Preliminary.
r Revised.
Source: U.S. Department of Commerce, Bureau of Economic Analysis.