U.S. Key Economic Indicators
Personal Income & Consumption
- Importance (A-F): This release merits a C+.
- Source: The Bureau of Economic Analysis of the Department of
- Release Time: 8:30 ET around the first business day of the month
(data for two months prior).
- Raw Data Available At: www.bea.gov -- see personal income
Personal income measures income from all sources. The largest component of
total income is wages and salaries, a figure which can be estimated using
payrolls and earnings data from the employment report. Beyond that, there are
many other categories of income, including rental income, government subsidy
payments, interest income, and dividend income. Personal income is a decent
indicator of future consumer demand, but it is not perfect. Recessions usually
occur when consumers stop spending, which then drives down income growth.
Looking solely at income growth, one may therefore miss the turning point when
consumers stop spending.
The income report also includes a section covering personal consumption
expenditures, also known as PCE. PCE is comprised of three categories: durables,
nondurables, and services. The retail sales report will provide a good read on
durable and nondurable consumption, while service purchases tend to grow at a
fairly steady pace, making this a relatively predictable report, and ranking it
well below retail sales in terms of market importance.