Personal income, savings increased in February

By BenefitsPro


By Paula Aven Gladych

According to the Bureau of Economic Analysis, personal and disposable personal income both increased 1.1 percent in February 2013 to $143.2 billion and $127.8 billion respectively.

Personal income and disposable income dropped 3.7 percent and 4 percent respectively in January, mostly due to the expiration of the payroll tax holiday and the acceleration of bonuses and personal dividends to December in anticipation of changes in individual tax rates, according to the BEA.

Personal saving was $310.9 billion in February compared with $262.5 billion in January. The personal saving rate—personal saving as a percentage of disposable personal income—was 2.6 percent in February, compared with 2.2 percent in January.

Private wage and salary disbursements increased $42.4 billion in February. In January, they decreased $42.7 billion. The February and January levels of private wages and salaries were reduced by $15 billion (at an annual rate), reflecting the impact of accelerated bonuses in anticipation of changes to individual income tax rates.

Supplements to wages and salaries increased $6.2 billion in February, compared with an increase of $6 billion in January.

Contributions for government social insurance increased $6.4 billion in February, compared with an increase of $126.8 billion in January. 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 percentage points, or $114.1 billion at an annual rate.

Originally published on BenefitsPro.com