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June 27, 2025US PERSONAL INCOME AND OUTLAY, MAY 2025 Month over month (May 2025 vs April 2025, seasonally adjusted)
US personal income decreased by $109.5 billion (-0.42%). Employee compensation was up $61.9 billion (+0.40%). Personal disposable income was down $125.0 billion (-0.55%) while personal consumption expenditures (PCE) declined by $29.3 billion (-0.14%).
US personal savings decreased by $97.3 billion (-8.76%).
US personal income is calculated as the sum of employee compensation ($15.68 trillion), proprietors' income ($2.05 trillion), rental income ($1.09 trillion), receipts on assets ($4.00 trillion) and current transfers received ($4.85 trillion), less contributions to social insurance programs ($1.98 trillion). Personal income ($25.70 trillion) less personal current taxes ($3.24 trillion) equals disposable income ($22.45 trillion).
The outlay of US personal disposable income consists of personal consumption expenditures ($20.59 trillion), interest payments ($0.57 trillion) and current transfers paid ($0.28 trillion) with personal savings ($1.01 trillion) accounting for the remaining amount.
Trends
US personal income decreased for te first time since 2021 owing to declines in transfers and proprietors income. US consumer spending fell for the second time in 2025,
Year over year (May 2025 vs May 2024, seasonally adjusted)
Growth in the price index for personal consumption expenditures (all items) was 2.3% year-over-year. Year-over-year growth in the price index for all items excluding food and energy was 2.7%, and outpaced all items PCE inflation for the 27th consecutive month.
With personal income contracting by more than personal consumption the US personal savings rate declined to 4.5% of disposable personal income in May 2025.
Year-to-date (January-May 2025 vs January-May 2024)
In the first five months 2025, US personal income increased by 4.7% from the same period in 2024. There were gains from all income sources led by growth in current transfers received (+8.0%). There was an increase in personal current taxes (+7.8%), and a year-to-date growth in personal disposable income (+4.3%).
US interest payments increased by 4.2% from the first five months of 2024 to January-April 2025. This was outpaced by a 5.1% increase in personal consumption expenditures.
US Bureau of Economic Analysis. Press release, May 2025; Data retrieved Federal Bank of St Louis, Table 2.6. Personal Income and Its Disposition, Monthly NIPA
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