Compared to a year ago, rental income also topped the charts, rising by a very strong 7.3%, as high home prices are pushing up rents. Wages and salaries were up 4.5%, with private industry wage growth of 4.8% far outpacing government wage growth of just 3.0%. Personal current transfer receipts were up 3.7%, with the strongest growth coming from Medicaid at 6.2%, followed closely by veterans’ benefits at 6.1%, while unemployment insurance was down 9.1%. Proprietors’ income was up just 3.3%, weighed down by a huge 42% drop in farm income from the prior year. Income on assets was up just 2.6%, driven almost entirely by interest income as dividends were virtually flat.
Wages and salaries accounted for over half of the total increase in personal income on both a monthly and yearly basis in January, which mostly came from private industry wages. A third of the monthly increase came from personal current transfer receipts, primarily due to a large 1.0% increase in social security.