Last Friday the U.S. Bureau of Economic Analysis reported that personal income increased by 0.2 percent in February. Similarly, disposable income (the money left over after taxes) increased at the same rate. While a fifth of a percent is not much, it’s good news after January saw a decrease in both personal income and disposable personal income.
Increases in wages and salaries were mostly responsible for the increase in income. There was also an increase in government social benefits and proprietor’s income. However, there was a decrease in personal interest income. This means that people are earning less money from interest sources such as their bank account, but are receiving enough money from wages/salaries and government benefits to offset the decrease.
The economy may be slowing down from the large increases in personal income seen last year, but at least we’ve recovered from the small losses in January.