Consumer spending in the United States increased by $113.1 billion, or 0.5 percent, in September 2023. This information is based on data released by the U.S. Bureau of Economic Analysis (BEA). However, after adjusting for inflation, real consumer spending increased by less than 0.1 percent this month, indicating a slight increase in the volume of spending.
Details of the Increase in Consumer Spending
The $113.1 billion increase in consumer spending in September includes a $35.1 billion increase in goods spending and a $78.1 billion increase in services spending. Overall, personal outlays, which include consumer spending, personal interest payments, and personal transfer payments, increased by $113.0 billion in September.
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Data also show that personal income increased by $54.5 billion, or 0.2 percent, in September. Disposable personal income, which is income after personal taxes, increased by $52.7 billion, or 0.2 percent. Explaining the increase in income, the BEA stated that this increase was primarily due to higher compensation and government social benefits.
Challenges from Inflation
Despite the increase in income and spending, inflation remains at a high level. The PCE price index, which measures changes in prices paid for goods and services, increased by 0.5 percent in September compared to the previous month and rose by 3.6 percent year-over-year. Additionally, core PCE inflation, which excludes food and energy prices, increased by 0.3 percent month-over-month and 3.1 percent year-over-year.
The difference between nominal and real spending growth reflects the impact of rising prices on consumers' spending. While Americans spent more in dollar terms, real consumer spending increased by less than 0.1 percent in September. In this context, BEA data also show that personal savings reached $911.1 billion, and the personal savings rate, calculated as a percentage of disposable personal income, stood at 3.8 percent in September.
These figures provide updates on household income, spending, and inflation in the United States as policymakers continue to monitor price pressures and consumer demand. The BEA has announced that subsequent data on income and personal spending for October 2026 will be released on November 25.
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