Compared to a year ago, rental income also topped the charts, rising by a very strong 5.6%, as high home prices are pushing up rents. Wages and salaries were up 5.5%, with private industry wage growth of 5.9% far outpacing government wage growth of just 3.5%. Proprietors’ income was up 4.2% as non-farm income was up 5.4% while farm income was down 47%. Personal current transfer receipts were up 3.8%, with the strongest growth coming from veterans’ benefits at 5.2%, while unemployment insurance was down 9.0%. Income on assets was up just 2.6%, driven almost entirely by interest income.
A big 6.0% increase in tax payments from the prior year knocked the growth rate of personal disposable income down to 4.3% from 4.4%. However, real personal disposable income growth increased to 2.4% from 2.2% thanks to a decline in prices in March. This should help to support second quarter economic growth after a dismal first quarter.