Government transfer payments decreased sharply in April compared to March, but were still almost $1.4 trillion (on SAAR basis) above the February 2020 level (pre-pandemic). Most of the increase in transfer payments – compared to the levels prior to the crisis – is from unemployment insurance and “other” (includes direct payments).
This table shows the amount of unemployment insurance and “Other” transfer payments since February 2020 (pre-crisis level). The increase in “Other” was mostly due to parts of the relief acts including direct payments.
|Selected Transfer Payments
Billions of dollars, SAAR
A key measure of the health of the economy (Used by NBER in recession dating) is Real Personal Income less Transfer payments.
This graph shows real personal income less transfer payments since 1990.
This measure of economic activity increased 0.5% in April, compared to March, and was up 0.3% compared to February 2020 (previous peak).
Real personal income less transfer payments was off 8.1% in April 2020. That was a larger decline than the worst of the great recession.
Currently personal income less transfer payments are at a new peak.
This is the first of the key NBER measures – GDP, Employment, Industrial Production, Real Personal Income less Transfer Payments – that is above pre-recession levels. GDP will be above pre-recession levels in Q2.