Income Falls 0.5% After 1% Gain in April
Americans’ personal income fell 0.5% in May from an April level that had been unusually high because of two special factors, the government said today.
The Commerce Department said income fell $16.5 billion last month after rising 1% in April. The April increase originally had been reported at 0.6%.
In addition to an influx of income tax refund checks that boosted the April income figures, the department cited two other factors: unusually large subsidy payments to farmers that month and a retroactive wage payment to postal employees that inflated the report.
Without those two factors, the department said, personal income for May would have been up 0.4%.
Those special factors notwithstanding, the May decline was the first monthly drop since a 0.1% drop in February, 1983, and the sharpest since a 0.8% decline in June of 1972.
Despite the statistical drop in income, personal consumption spending increased 0.7% in May after a revised 1% increase in April. That increase had previously been reported to be 0.7%.
Private wages and salaries rose 0.3% in May after a 0.5% increase the previous month. Factory payrolls were up 0.2% after falling 0.4% in April.