EMBARGOED UNTIL RELEASE AT 8:30 A.M. EST, FRIDAY, MARCH 1, 2013
BEA 13-07


* See the navigation bar at the right side of the news release text for links to data tables,
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James Rankin: (202) 606-5301 (Personal Income) piniwd@bea.gov
Harvey Davis: (202) 606-5302 (Personal Consumption Expenditures) pce@bea.gov
PERSONAL INCOME AND OUTLAYS, JANUARY 2013
Personal income decreased $505.5 billion, or 3.6 percent, and disposable personal income (DPI)
decreased $491.4 billion, or 4.0 percent, in January, according to the Bureau of Economic Analysis.
Personal consumption expenditures (PCE) increased $18.2 billion, or 0.2 percent.  In December,
personal income increased $353.4 billion, or 2.6 percent, DPI increased $325.7 billion, or 2.7
percent, and PCE increased $14.8 billion, or 0.1 percent, based on revised estimates.

Real disposable income decreased 4.0 percent in January, in contrast to an increase of 2.7
percent in December.  Real PCE increased 0.1 percent, the same increase as in December.

                                        2012                                                            2013
                                        Sept.           Oct.            Nov.            Dec.            Jan.
                                                       (Percent change from preceding month)
Personal income, current dollars        0.4             0.0             1.0             2.6            -3.6
Disposable personal income:
 Current dollars                        0.4             0.0             1.0             2.7            -4.0
 Chained (2005) dollars                 0.1            -0.1             1.2             2.7            -4.0
Personal consumption expenditures:
 Current dollars                        0.8             0.0             0.4             0.1             0.2
 Chained (2005) dollars                 0.5            -0.2             0.5             0.1             0.1

BOX.____________
The 4.0 percent decrease in January DPI mainly reflected the effect of special factors, which boosted employee
contributions for government social insurance in January and which had boosted wages and salaries
and personal dividends in December.  Excluding these special factors and others, which are discussed more
fully below, DPI increased $37.6 billion, or 0.3 percent in January, after increasing $38.6 billion, or
0.3 percent, in December.
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FOOTNOTE.________
Monthly estimates are expressed at seasonally adjusted annual rates, unless otherwise specified. Month-to-month
dollar changes are differences between these published estimates.  Month-to-month percent changes are calculated from
unrounded data and are not annualized.  “Real” estimates are in chained (2005) dollars.

This news release is available on BEA’s Web site at www.bea.gov/newsreleases/rels.htm.
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BOX._____________
This news release presents revised estimates of wages and salaries, personal taxes,
and contributions for government social insurance for July through September 2012 (third quarter).
These estimates reflect the incorporation of newly available third-quarter wage and salary tabulations from
the quarterly census of employment and wages from the Bureau of Labor Statistics.
_________________

                                Wages and salaries

Private wage and salary disbursements decreased $44.8 billion in January, in contrast to an increase
of $49.1 billion in December.  The January level of private wages and salaries was reduced by
$15.0 billion (at an annual rate) in January, after a boost of $30.0 billion in December, reflecting
the impact of accelerated bonuses in anticipation of changes to individual income tax rates.
Goods-producing industries' payrolls decreased $3.3 billion in January, in contrast to an increase
of $9.8 billion in December; manufacturing payrolls decreased $3.3 billion, in contrast to an increase
of $5.4 billion.  Services-producing industries' payrolls decreased $41.5 billion, in contrast to an
increase of $39.3 billion.

Government wage and salary disbursements increased $1.1 billion, compared with an increase of $0.8 billion.
Pay raises for military personnel added $1.9 billion to government payrolls in January.

                                Other personal income

Employer contributions for employee pension and insurance funds increased $3.2 billion in January, compared
with an increase of $3.0 billion in December.

Employer contributions for government social insurance increased $2.7 billion in January, compared with an
increase of $3.7 billion in December.  The January estimate reflected increases in the social security
taxable wage base (from $110,100 to $113,700), in the tax rate paid by employers to state unemployment insurance,
and in employer contributions for the federal unemployment tax and for pension guaranty; together, these changes
added $5.9 billion to January.  (Changes in employer contributions for government social insurance do not affect
personal income, because employer contributions for government social insurance are also included in total
contributions for government social insurance, which is a subtraction in the calculation of personal income.)

Proprietors' income increased $6.3 billion in January, compared with an increase of $7.3 billion in December.
Farm proprietors' income increased $4.9 billion, in contrast to a decrease of $0.8 billion.  Nonfarm proprietors'
income increased $1.4 billion, compared with an increase of $8.1 billion.

Rental income of persons increased $11.2 billion in January, compared with an increase of $1.3 billion in December.
Personal income receipts on assets (personal interest income plus personal dividend income) decreased $365.5 billion,
in contrast to an increase of $273.8 billion.  The level of personal dividend income was reduced $81.0 billion in
January (at an annual rate), after a boost of $291.0 billion in December, reflecting accelerated and special
dividend distributions paid in December; these adjustments reflected the impact of expected changes to individual
income tax rates.  For additional information, see the FAQ on “How would special and accelerated dividends affect
the national income and product accounts in the fourth quarter 2012?” at www.bea.gov.

Personal current transfer receipts increased $7.0 billion in January, compared with an increase of $20.7 billion
in December.  The January estimates of current transfer receipts reflected 1.7-percent cost-of-living adjustments
to social security benefits and to several other federal transfer payment programs; together, these changes
added $15.2 billion to the January increase. The January change in social security benefits to persons was
reduced by lump-sum payments, which had added $7.0 billion to December; these benefit payments resulted from
a recalculation of the earnings base underlying the benefits for recent retirees.

Contributions for government social insurance -- a subtraction in calculating personal income -- increased $126.7 billion
in January, compared with an increase of $6.3 billion in December.  The January estimate reflected increases in both
employer and employee contributions for government social insurance.  The January estimate of employee contributions for
government social insurance reflected the expiration of the “payroll tax holiday,” that increased the social
security contribution rate for employees and self-employed workers by 2.0 percentage points, or $114.1 billion
at an annual rate.  For additional information, see FAQ on “How did the expiration of the payroll tax holiday affect
personal income for January 2013?” at www.bea.gov.  The January estimate of employee contributions for government social
insurance also reflected an increase in the monthly premiums paid by participants in the supplementary medical insurance
program, in the hospital insurance provisions of the Patient Protection and Affordable Care Act, and in the social
security taxable wage base; together, these changes added $12.8 billion to January.  As noted above, employer contributions
were boosted $5.9 billion in January, so the total contribution of special factors to the January change in contributions
for government social insurance was $132.8 billion.

                                Personal current taxes and disposable personal income

Personal current taxes decreased $14.0 billion in January, in contrast to an increase of $27.6 billion in December.
The January change reflected additional taxes paid on accelerated income distributions in December.  Payments of final
settlements and back taxes less refunds in Federal net nonwithheld income taxes reduced the January change by $3.4 billion,
based on the Office of Tax Analysis projections.  Indexation provisions of current tax law reduced federal withheld
income taxes by $1.4 billion in January.

Disposable personal income (DPI) -- personal income less personal current taxes -- decreased $491.4 billion, or 4.0 percent,
in January, in contrast to an increase of $325.7 billion, or 2.7 percent in December.

                                Personal outlays and personal saving

Personal outlays -- PCE, personal interest payments, and personal current transfer payments -- increased $22.0 billion in January,
compared with an increase of $13.3 billion in December.  PCE increased $18.2 billion, compared with an increase of $14.8 billion.

Personal saving -- DPI less personal outlays -- was $283.9 billion in January, compared with $797.4 billion in December.
The personal saving rate -- personal saving as a percentage of disposable personal income -- was 2.4 percent in January,
compared with 6.4 percent in December. For a comparison of personal saving in BEA's national income and product accounts
with personal saving in the Federal Reserve Board’s flow of funds accounts and data on changes in net worth, go to
http://www.bea.gov/national/nipaweb/Nipa-Frb.asp.

                                Real DPI, real PCE and price index

Real DPI -- DPI adjusted to remove price changes -- decreased 4.0 percent in January, in contrast to an increase of 2.7 percent in
December.

Real PCE -- PCE adjusted to remove price changes -- increased 0.1 percent in January, the same increase as in December.
Purchases of durable goods decreased 0.8 percent in January, in contrast to an increase of 1.3 percent in December.
Purchases of motor vehicles and parts accounted for most of the decrease in January.  Purchases of nondurable goods
increased 0.3 percent in January, compared with an increase of 0.1 percent in December.  Purchases of services increased
0.3 percent, in contrast to a decrease of less than 0.1 percent.

PCE price index -- the price index for PCE increased less than 0.1 percent in January, in contrast to a decrease of less
than 0.1 percent in December.  The PCE price index, excluding food and energy, increased 0.1 percent, compared with an
increase of less than 0.1 percent.


                                2012 Personal Income and Outlays

Personal income increased 3.5 percent in 2012 (that is, from the 2011 annual level to the 2012 annual level), compared
with an increase of 5.1 percent in 2011.  DPI increased 3.3 percent, compared with an increase of 3.8 percent.
PCE increased 3.7 percent, compared with an increase of 5.0 percent.

Real DPI increased 1.5 percent in 2012, compared with an increase of 1.3 percent in 2011.  Real PCE increased 1.9 percent,
compared with an increase of 2.5 percent.


                                Revisions

Estimates of personal income and DPI have been revised for July through December; estimates for PCE have been revised for
October through December.  Changes in personal income, current-dollar and chained (2005) dollar DPI, and current-dollar
and chained (2005) dollar PCE for November and December -- revised and as published in last month's release -- are shown below.

Estimates of wages and salaries were revised from July through December.  The revision to third-quarter wages and salaries
reflected the incorporation of the most recently available BLS tabulations of the third-quarter wages and salaries from the
quarterly census of employment and wages.  Revised estimates for October, November, and December reflect extrapolations from
the revised third-quarter level of wages.  In addition, revisions to November and December reflect revised BLS employment,
hours, and earnings data.

                                                                Change from preceding month
                                        November                                  December
                                        Previous   Revised   Previous   Revised   Previous   Revised   Previous   Revised
                                       (Billions of dollars)      (Percent)      (Billions of dollars)      (Percent)
Personal Income:
 Current dollars                           135.8     140.1        1.0       1.0      352.4     353.4        2.6       2.6
Disposable personal income:
 Current dollars                           125.5     121.4        1.0       1.0      331.3     325.7        2.7       2.7
 Chained (2005) dollars                    129.7     119.8        1.3       1.2      289.8     281.7        2.8       2.7
Personal consumption expenditures:
 Current dollars                            41.6      41.5        0.4       0.4       22.6      14.8        0.2       0.1
 Chained (2005) dollars                     56.2      50.3        0.6       0.5       23.7      14.2        0.2       0.1

BEA’s national, international, regional, and industry estimates; the Survey of Current Business; and BEA news releases are
available without charge on BEA’s Web site at www.bea.gov.  By visiting the site, you can also subscribe to receive free
e-mail summaries of BEA releases and announcements.

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Next release – March 29, 2013 at 8:30 A.M. EDT for Personal Income and Outlays for February
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