How did consumer spending and personal income change after the child tax credits were sent?
Each month Economic Analysis Office (BEA) publishes personal income and consumer spending data for the previous month.
At the end of August, the eagerly awaited figures of July were released. Many have been while waiting to see these figures while the government sent the first payment of the child tax credit to millions of families.
The BEA reported that there was a slight increase observed at the level of consumer spending focused on the service sector. However, there has been a decrease in expenditure on property, which luckily has been offset by the iincrease observed in the service sector. In the service sector, spending was mainly focused on catering and accommodation.
The decrease in expenditure on goods was observed “in both durable and unsustainable goods, led by motor vehicles and parts (including new light trucks). “
In July, increases in personal income have been observed which, according to the BEA, have been motivated by “government benefits and employee compensationAs more and more workers are returning to the labor market.
However, the the gains were not as dramatic as some expected as many unemployed have seen their benefits reduced, reduce household income.
Read more about the BEA here.