Personal income increased $14.1 billion (0.1 percent) in July, a barely noticeable change from the previous month, the Bureau of Economic Analysis announced Friday.
Disposable personal income (DPI) increased $21.7 billion (0.2 percent) during the same period.
As a result of the poor showing, U.S. consumer spending was flat in July. In fact, consumers actually cut back on purchases of “long-lasting manufactured goods” (thankfully, spending on services held steady).
Consumer spending accounts for nearly 70 percent of economic activity. Stagnant spending shows the economy is struggling to get back on its feet.
July’s increase, though barely noticeable, is about what we’ve come to except from 2013’s income reports.
“Personal consumption expenditures (PCE) increased $16.3 billion, or 0.1 percent. In June, personal income increased $38.2 billion, or 0.3 percent, DPI increased $27.3 billion, or 0.2 percent, and PCE increased $64.0 billion, or 0.6 percent, based on revised estimates,” the BEA report said.
“Real disposable income increased 0.1 percent in July, in contrast to a decrease of 0.2 percent in June. Real PCE,” it said.
Wages and salary disbursement increased $15.3 billion in July, which is pretty sad considering June saw an increase of $31.3 billion.
Meanwhile, supplements to wages and salaries fell $0.1 billion in July, which, again, is pretty sad considering this figured saw an increase of $3.4 billion in June.
U.S. stocks aren't exactly thrilled with the news:
Lastly, government wages and salaries fell $6.4 billion in July, which is huge considering the number declined by only $0.8 in June.
“Government wages were reduced by $7.7 billion in July and $0.7 billion in June due to furloughs that impacted several federal government agencies,” the report notes.
Here’s the complete BEA report:
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Featured image Getty.