Washington Research Council economist Kriss Sjoblom has updated with two new charts his series on income, spending and savings during the pandemic. In his update, he writes,
As a result of the $1.9 trillion federal relief package enacted in March, personal income rose 21.1% from February to March. Consumer spending increased by a more modest 4.2%, while the saving rate soared to 27.6%.
Here’s the savings chart.
That boost in the savings rate will pay dividends over time.
The saving rate jumped from 8.3% in February 2020 to an astounding 33.7% in April and then declined in steps to 12.5% in November. The saving rate moved up modestly in December, jumped to 20.0% in January, fell back to 13.9% in February and jumped to 27.6% in March. The total amount saved from April 2020 through March 2021 was $3.47 trillion. Had the saving rate been the average for 2019, 8.3%, the amount saved would have been just $1.35 trillion. Excess saving over the 12 months totaled $2.12 trillion. Spending down this pool (ocean?) of excess saving will be a source of strength for the economy as the pandemic recedes.
We encourage you to click through for the charts and additional analysis.