Personal Income Jumped in January, But It's a One-Time Deal
Let's step away from the coronavirus and put a spotlight on income and spending from the BEA report Personal Income and Outlays for January 2020.
- Personal income increased $116.5 billion (0.6 percent) in January.
- Disposable personal income (DPI) increased $101.4 billion (0.6 percent).
- Personal consumption expenditures (PCE) increased $29.6 billion (0.2 percent).
- Real DPI increased 0.5 percent in January and Real PCE increased 0.1 percent.
- The PCE price index increased 0.1 percent.
- Excluding food and energy, the PCE price index increased 0.1 percent.
Minimum Wage Hikes
Workers in Majority of U.S. States had a Minimum Wage Increase in 2020. The biggest impact was in California, New York City, and District of Columbia.
- California raised the minimum wage rates by $1 on January 1 ($12.00 per hour for employers with 25 employees or less, and $13.00 per hour for employers with 26 employees or more).
- New York City is $15.00 per hour.
- Washington D.C. rose from $14.00 per hour to $15.00.
- Most employers and employees are subject to a higher federal minimum wage rate of $7.25 per hour but Georgia and Wyoming have minimum wages of $5.15 per hour.
This 0.6% jump in pay is one-time January only impact unlikely to be repeated throughout the year.
Mike "Mish" Shedlock