J.P. Morgan: US consumers' disposable income rose rapidly in April

J.P. Morgan: US consumers' disposable income rose rapidly in April

June 8, 2020

United States
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In the month of April, US disposable personal income rose by 12.9%. Incomes were boosted by stimulus cheques and supported by generous unemployment benefits.

Together these outweighed the fact that income from employee compensation fell 7.7%. But with much of the country still not open in April, consumers had few options to spend this extra money and so consumption fell by 13.6%. Reports suggest that three-quarters of laid off US workers are currently receiving more in federal benefits than they earned when working. The challenge for Congress is to incentivise consumers to get back to work where safe to do so without removing the generous income support from those who can’t safely return to work or find a job to return to.

% change month on month

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Source: Bureau of Economic Analysis, Refinitiv Datastream, J.P. Morgan Asset Management. Data as of 5 June 2020.

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